India's aviation governing body, the Directorate General of Civil Aviation, has approved the Boeing 737 MAX jet to return to service in its country, nearly 2.5 years after it was grounded.
The 737 MAX was grounded in March of 2019 after two fatal crashes killed 346 people. The cause was a malfunction in the plane's flight control that caused the pilots to lose control of the aircraft.
The resumption of MAX aircraft services would be subject to regulatory approvals, SpiceJet, India's second-largest airline by market share and the only one in the country to fly the aircraft, said. Avolon declined to comment.
SpiceJet, which said earlier this month it was in discussions with lessors of MAX aircraft to restructure present leases, did not provide any further details on the settlement.
With easing of the travel restrictions and increasing pace of vaccinations, there might be some pick-up in air traffic and SpiceJet's settlement to restart MAX aircraft could help it get back on track, said Likhita Chepa, senior research analyst at CapitalVia Global Research.
"However, higher ATF (Air Turbine Fuel) prices might hurt margins and operability," Chepa added.
Boeing continues to work with global regulators to safely return the 737-8 and 737-9 to service, the U.S. planemaker said in a statement to Reuters, while declining to comment on the compensation.
China has yet tp approve the plane in its country. It is also thought that ongoing tensions between China and the U.S. may be stalling efforts to get the aircraft back in the sky there.