Govt committed to ‘own and run’ Air India

New Delhi: The Government will continue to both “own and run” Air India and do everything possible to help the state-owned carrier, the Minister for Civil Aviation, Mr Praful Patel, said here on Tuesday.
“Ideally speaking, it is not the job of the Government to run an airline. But when the Government has decided that it will own and run Air India, it is our job to ensure that it runs. We are only wanting to give equity support and substitute their high-cost debt by low-cost debt. Beyond that we are not going to write out a cheque,” the Minister said during a 90-minute interaction with the staff at the Business Line office here.
Stating that the Government had not provided a single rupee to either Air India or Indian, the Minister said that the Government will provide a letter of comfort only after they come “with a full proposal on how much of high-cost debt they want to replace.”
Pointing out that all airlines had run up losses, Mr Patel said that of the Rs 7,000-crore losses of Air India, almost Rs 2,000 crore was depreciation on newly acquired aircraft and another Rs 1,000 crore was interest costs.
He said the airline will have to restructure its business model and try and earn third party business from maintenance, repair and overhaul, jet shop and from other activities such as ground handling.
18/08/09 BusinessLine

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Categories: NACIL Aug 2009