Budget says aviation PSUs must find another Rs 12,000 crore this year

New Delhi: The government has increased the target of internal and extra budgetary resources (money from loans or through reinvestment of profits) which will be raised by public sector undertakings under the Ministry of Civil Aviation by over 63.5 per cent, from Rs 7,320 crore in the revised estimates of 2008-09 to Rs 11,974.8 crore in 2009-10.
The money will be used mostly to fund the aircraft acquisition programme of the financially ailing National Aviation Company of India Ltd (Nacil), which runs the Air India brand, and also the Airports Authority of India (AAI) which is undertaking the expansion of airports in Kolkata and Chennai, among others.
As a result, the outlay of the ministry has gone up substantially from Rs 7,490.6 crore in the revised estimates of 2008-9 to Rs 12,164.8 crore in 2009-10, a jump of over 62 per cent.
The government, in its Budget documents, says the plan allocation of the ministry has been raised to meet the expenditure due to enhanced competitiveness of Indian carriers for international operations, cost of a media campaign and for capacity-building to enhance effective management and control in aviation.
Nacil is making an investment of over Rs 40,000 crore to buy over 118 aircraft and is in dire need of loans to fund its acquisition of new planes.
The Air India management has been looking for a bailout package to get the corporation out of the woods, which includes a combination of expanding its equity capital base (Rs 140 crore) and also to raise loans from the market.
09/07/09 Business Standard

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Categories: Indian Aviation- In General Jul 2009, NACIL Jul 2009