Mumbai, Jan 2 (IANS): Rating agency ICRA has downgraded financially-troubled Jet Airways' short and long term credit facilities after the company on Tuesday reported a delay in paying interest and instalment due to banks.

The downgrade comes at a time when India's airline sector faces heavy competition with low air fares.

Accordingly, the airline's long term rating assigned to "Long term Loans" and "Non-Convertible Debentures" was revised to D (negative outlook) from C (negative outlook).

"The ratings downgrade considers the delays by the company in the payment of the interest and principal instalment due on December 31, 2018 due to cash flow mismatches," ICRA said in a statement on Wednesday.

"There have been delays in the implementation of the proposed liquidity initiatives by the management, which have aggravated its liquidity."

According to the statement, the company has already been delaying its employee salary payments and lease rental payments to the aircraft lessors.

"Furthermore, the company has large debt repayments due over December 2018 to March 2019 (Rs 1,700 crore), FY2020 (Rs 2,444.5 crore) and FY2021 (Rs 2,167.9 crore)," the statement said.

"The company is undertaking various liquidity initiatives, which includes, among others, equity infusion and a stake sale in Jet Privilege Private Limited (JPPL), and the timely implementation of these initiatives remain critical to its credit profile."