New Delhi: Air India is unable to purchase all the spares it needs, resulting in idling aircraft, due to a monthly cash deficit of Rs 200-250 crore that affects availability of funds for maintenance, the civil aviation ministry has candidly admitted.
The ministry has told Parliament’s Public Accounts Committee that a restricted cash flow was responsible for inoperational aircraft despite a turnaround plan (TAP) being in force since 2011 while fleet expansion had been hit by viability issues and an ongoing CBI probe into previous acquisitions.
“There is a cash deficit of Rs 200 crore to Rs 250 crore every month which affects availability of funds for procurement of spares,” the ministry told the PAC even as it said that “every attempt” was being made to devote maximum financial resources to availability of spares to improve utilisation of aircraft.
It needed $300 million accessed through external commercial borrowings to liquidate outstanding dues of foreign suppliers in 2015 to improve the situation as maintenance expenditure soaked up Rs 2,500 crore or 12% of the debt-laden airline’s operating expenditure.
An examination of AI’s functioning by the PAC is significant in the light of the government’s decision to disinvest 76% stake in the carrier.
23/04/18 Rajeev Deshpande/Times of India
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The ministry has told Parliament’s Public Accounts Committee that a restricted cash flow was responsible for inoperational aircraft despite a turnaround plan (TAP) being in force since 2011 while fleet expansion had been hit by viability issues and an ongoing CBI probe into previous acquisitions.
“There is a cash deficit of Rs 200 crore to Rs 250 crore every month which affects availability of funds for procurement of spares,” the ministry told the PAC even as it said that “every attempt” was being made to devote maximum financial resources to availability of spares to improve utilisation of aircraft.
It needed $300 million accessed through external commercial borrowings to liquidate outstanding dues of foreign suppliers in 2015 to improve the situation as maintenance expenditure soaked up Rs 2,500 crore or 12% of the debt-laden airline’s operating expenditure.
An examination of AI’s functioning by the PAC is significant in the light of the government’s decision to disinvest 76% stake in the carrier.
23/04/18 Rajeev Deshpande/Times of India
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