Saturday, August 11, 2018

Finance Ministry opposes bailout package to Air India, writes to PMO

New Delhi: What can be a setback for the Air India, the Finance Ministry has opposed request of a bailout package from the Civil Aviation Ministry worth Rs.11,000 crore, citing the fiscal constraint and has communicated the same to the Prime Minister’s Office.

According to the sources in the Finance Ministry, the Civil Aviation Minister had approached the finance ministry with a request of fresh bailout package for the revival of ailing Air India to the tune of Rs, 11400 crore, after the plan to disinvest failed in May. The ministry says that the package would be utilised to reduce high-cost working capital loans of Air India.

However, the Finance Ministry, which is already managing revenue deficit and subsidies, is strongly opposed to the move.

“The cabinet has recently approved about 980 crore for the Air India. But government cannot eternally bail them out. We have to look at fiscal targets also. Even when the stake sale plan has not worked, the Carrier had to find out some way to be profitable. We are already opposed to the move and has communicated the same to the PMO,” a senior official from the Finance Ministry told TNIE.
10/08/18 New Indian Express