One year ago, creditors of Garuda Indonesia (GIAA.JK) gave the national carrier approval for a three-year extension on a $500 million sukuk, or Islamic bond. Now the airline has deferred those payments and is asking for a wider standstill . A government official says its debt is around $4.5 billion and needs to be restructured to one-third or less of that amount for the company to survive. Garuda was in poor shape pre-pandemic, and its long effort to avoid bankruptcy has come to a head. Even the government, the company’s majority owner, has cut back on support after it breached covenants. Aircraft lessors have the most to lose, and foreign debt-holders will complicate any resolution. There’s bumpy air ahead if other Southeast Asian carriers’ experiences are a guide. A court hearing on Thai Airways International’s (THAI.BK) $7.8 billion restructuring has been delayed read more because of creditor complaints. While shareholders in the long-haul unit of Malaysia’s AirAsia (AIRA.KL) have approved a debt rejig, creditors are yet to consent. With the pandemic still burning, options are limited. (By Una Galani) On Twitter http://twitter.com/breakingviews Capital Calls - More concise insights on global finance: Japan activists want to make a withdrawal read more Kremlin dollar dump is economic inflatable hammer read more Rent the Runway follows the trend read more Food price spike looks like recipe for trouble read more Twin tech deals flag nascent EU strength read more