“Pranab Mukherjee Told Me Not to Downsize”: Vijay Mallya Pins Kingfisher Collapse on Finance Ministry Advice

New Delhi: In a rare public appearance after years of silence, fugitive businessman Vijay Mallya has spoken at length about the collapse of Kingfisher Airlines, blaming the 2008 global financial crisis for the airline’s downfall. In a candid podcast conversation with entrepreneur Raj Shamani, Mallya offered his version of events, pointing to macroeconomic factors and alleged lack of support from financial institutions.

“So agreed then it worked in your favour till 2008. What happened then? Simple. You ever heard of Lehman Brothers? You ever heard of the global financial crisis, right? Did it not impact India? Of course, it did,” Mallya said in the podcast, referring to the collapse of global markets following the failure of Lehman Brothers, one of the triggers of the worldwide economic meltdown.

He added, “Every sector was hit. The money stopped. It got dry. The value of the Indian rupee also took a hit,” arguing that the worsening economic climate dried up liquidity and left Kingfisher Airlines struggling for survival.

Kingfisher Airlines, launched in 2005 and once known for its luxury and hospitality, began facing mounting losses in the years following the financial crash. Mallya revealed that he had approached then Finance Minister Pranab Mukherjee with a restructuring proposal to cut costs and reduce operations.

“I went to Shri Pranab Mukherjee… and said I have a problem. Kingfisher Airlines needs to downsize, cut the number of aircraft, and lay off employees, as I can’t afford to operate under these depressed economic circumstances,” Mallya recounted.

However, according to him, that proposal was rejected. “I was told not to downsize. You continue, banks will support you. That is how it all started. Kingfisher Airlines has been forced to suspend all of its flights. Kingfisher Airlines has been struggling. At the time when you asked for a loan, the company was not doing that great,” he said.

Mallya fled India in 2016 and has since remained in the United Kingdom, facing extradition requests from Indian authorities over allegations of fraud and money laundering involving loans worth over ₹9,000 crore. Several Indian banks have accused him of defaulting on massive loans, and legal proceedings are still ongoing.