Jet Airways collapses as banks pull out

The once mighty Indian carrier said in a statement on Wednesday that it was suspending all its flights after failing to secure emergency funding from the country's banks.

"This has been a very difficult decision, but without interim funding, the airline is simply unable to conduct air operations," Jet Airways said in a statement.

The company said it was informed Tuesday by a consortium of lenders that they would not be able to provide new financing. Jet Airways has not been able to find another source of money.

Jet Airways has described the suspension of air operations as temporary, but the lack of funding is jeopardizing more than 20,000 jobs.

The carrier was founded in the early 1990s by Naresh Goyal and then dominated the airline industry in India, representing nearly 20% of the passengers transported by Indian airlines in 2018.

Yet in recent years, it has struggled to cut costs to compete with new low-budget companies such as IndiGo. The rise in oil prices and the increased volatility of the Indian currency, the rupee, only make things worse.

Swati Gupta contributed to the reports.