AI looks for Rs 5k cr this year

New Delhi: The aviation ministry will seek Rs 5,000 crore from the government this year itself for the cash-strapped Air India.
A few weeks back, a committee of secretaries headed by Cabinet Secretary had cleared infusion of Rs 5,000 crore into AI over the next three years, provided the airline cuts costs and raises revenue. Now the request for giving this sum this year itself will be raised in a GoM meeting to be chaired by finance minister Pranab Mukherjee on Wednesday.
Top sources said the ministry would seek Rs 2,000 crore as equity this year along with Rs 3,000 crore under a capital acquisition programme. “The entire order of 111 new planes at a cost of Rs 50,000 crore has to be funded by debt. Looking at the current market situation, 100% debt financing seems an unviable option. We are going to seek Rs 3,000 crore towards principal and interest of aircraft purchase this year,” said sources.
In all, the ministry may seek close to Rs 9,000 crore for purchase of aircraft over next three years along with a Rs 5,000 crore equity infusion over same period.
Now all eyes are on the Pranab Mukherjee-headed GoM to see how they respond to this SOS for AI as earlier the government had given conditional nod to Rs 5,000 crore equity infusion over three years.
20/10/09 Saurabh Sinha/Times of India

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Categories: NACIL Oct 2009