AI will have to raise on its own fund for fleet acquisition
Cash-strapped Air India will have to raise Rs 8,165 crore out of its own resources or borrowings to fund its fleet acquisition programme as the Union Budget focused primarily on aviation infrastructure development, giving a total budgetary support of Rs 190 crore.india Updated: Jul 06, 2009 23:00 IST
Cash-strapped Air India will have to raise Rs 8,165 crore out of its own resources or borrowings to fund its fleet acquisition programme as the Union Budget focused primarily on aviation infrastructure development, giving a total budgetary support of Rs 190 crore.
National Aviation Company of India Ltd (NACIL), which did not get any budgetary support, will have to meet all of its Rs 8,165 crore investment from internal and extra budgetary resources (IEBR), with the Civil Aviation Ministry and other PSUs under it getting a total support of Rs 190 crore only.
Air India has been seeking equity infusion and soft loan from the government to help it meet growing expenses mostly relating to fleet acquisition and interest payments.
The 2009-10 outlay for the Ministry was Rs 12,165 crore, compared with Rs 10,031 crore and a revised outlay of Rs 7,490.06 crore in 2008-09.
The only proposal which was welcomed by the industry was on abolition of Fringe Benefit Tax (FBT).
This would incur some savings for the airlines as they were so far paying FBT on expenses incurred on hotel stay for their cabin and cockpit crew in India and abroad.
Of the total budgetary support of Rs 190 crore, the Airports Authority of India (AAI) has been allocated Rs 99.15 crore to modernise non-metro airports.
Of this, Rs 20 crore of the AAI's budgetary allocation has been earmarked for development of airports in the Northeast and the remaining Rs 79.15 crore on airport development at crucial places like Jammu, Srinagar, Agatti (Lakshadweep) and Puducherry.
The Directorate General of Civil Aviation has been given a budgetary support of Rs 50 crore, while the Bureau of Civil Aviation Security was allocated Rs 14 crore to pursue their Plan schemes, the budget document said.
The total non-Plan expenditure estimated in the budget for the Ministry stands at Rs 11,974.76 crore.
The AAI would have to raise Rs 3,145.81 crore, while Pawan Hans Helicopters Ltd would have to raise Rs 74.50 crore from internal and external resources.
The state-owned chopper firm has been given a budgetary support of Rs 10 crore for constructing a heliport in Rohini area of Delhi and to provide disaster management and mitigation services.
The Hotel Corporation of India, an AI subsidiary, would also have to raise Rs 15 crore out of its internal
resources or borrowings.