Air India to get infusion of Rs 1200-cr equity
Ailing Air India today got a fresh equity infusion of Rs 1200 crore in the third instance of financial assistance to the beleaguered national carrier from the government. The decision was taken at a meeting of the Cabinet committee on economic affairs chaired by Prime Minister Manmohan Singh. HT reports.business Updated: Aug 04, 2011 23:07 IST
The government on Thursday approved an infusion of Rs 1200-crore equity to help Air India tide over its present crisis but has asked the civil aviation ministry to come back to it in two months with a revival and re-structural plan to turn around the ailing national carrier.
With this third dose, Air India has so far received financial assistance amounting to Rs 2,000 crore in the last two financial years while its cumulative loss and debt burden is said to be around R67,000 crore. The airline has not even been able to pay salaries to its employees for some time now.
Sources said the days of Air India CMD Arvind Jadhav, who has been asked to fly back from London, may be numbered.
Civil aviation secretary Nasim Ahmed Zaidi made a presentation to the cabinet committee on economic affairs chaired by Prime Minister Manmohan Singh. Former civil aviation minister Praful Patel did not speak at the meeting where several ministers flagged their concern and raised questions.
The airline which is reportedly reporting a monthly loss of Rs 600 crore, is hoping that the equity induction would help ease the cash flow into the company and avoid borrowings from markets at high costs.