With a liability of Rs 2,000 crore, the present crisis at SpiceJet is not

unprecedented. Rising debt may lead to grounding of the airline. In 2012,

Kingfisher Airlines Ltd of liquor baron Vijay Mallya was grounded after
accumulating $1.4 billion of debt.
The bankers, who lent huge money to Kingfisher and struggling to recover
their money, go on record to admit that the sector had a brand and it is
painful to see that grounded. The Kingfisher was grounded because of
huge operational losses it incurred by providing quality service to
passengers at low cost and finally it became unsustainable. The bankers
consortium was eagerly looking for a viable revival plan. Unfortunately,
that did not happen and promoters were declared as wilful defaulters.
Similarly, SpiceJet is also not able to meet the high cost of operations at a
time when the sector is going through consolidation phase. Sustaining
high operational cost with cut-throat competition from big domestic and
foreign players and strict norms set by the Government and its agencies