Tuesday, March 28, 2017

House panel asks govt to release Air India funds

The Parliamentary Standing Committee on Transport has said the finance ministry not agreeing to infuse the equity amount that Air India had sought will affect the performance of the airline.

Finance Minister Arun Jaitley in the Union Budget for FY18 allotted Rs 1,800 crore against Air India’s demand of Rs 2,587 crore.

As part of a turnaround plan approved by the former United Progressive Alliance government in 2012, the Centre had agreed to infuse Rs 30,231 crore in the airline till 2020-21.

The committee headed by Trinamool Congress M P Mukul Roy said the shortfall of Rs 787 crore could force the airline to borrow from banks at a higher interest rate.

“A shortfall when the company is at a critical position in achieving targets under a turnaround plan should be avoided. The committee recommends that the full amount of equity infusion be restored to Air India,” the panel’s report said.
28/03/17 Arindam Majumder/Business Standard