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Air India to receive first Dreamliners this month

delhi Updated: Jun 06, 2012 20:13 IST
AFP
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Struggling state-run carrier Air India will take delivery of its first Boeing Dreamliner aircraft later this month after the two firms agreed compensation for delays, the government said Wednesday.

Air India was supposed to receive the first of 27 Dreamliners by the end of May after years of delays that have added to the woes of the airline amid strikes and mounting debts.

"The board has accepted the payment proposal offered by the company," Civil Aviation Minister Ajit Singh told reporters without revealing details of the compensation deal with Boeing.

Two years ago Air India told parliament it wanted compensation of $710 million for the delays, while Boeing had offered $145 million. Indian officials have since said the sum sought by the airline may increase to near $1 billion.

Air India is struggling for survival with over 300 pilots on strike and losses of nearly $2 million a day.

In April the government approved a restructuring plan aimed at turning around the fortunes of the airline.

Air India used to dominate India's skies but its market share has shrunk sharply in the face of fierce competition from private carriers.

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