AI to get Rs800 crore lifeline by year-end

New Delhi: Ailing national carrier Air India, run by National Aviation Co. of India Ltd, is likely to see Rs800 crore of capital infusion by December-end, a group of ministers (GoM) led by finance minister Pranab Mukherjee recommended on Thursday, based on a monthly review of the carrier’s cost-cutting measures.
The matter will require cabinet clearance and covers a portion of the money that will infused as part of a government rescue plan for the cash- strapped airline.
The first two tranches of Rs400 crore each, meant to be paid after the reviews in November and December, are likely to be released by the year-end after Parliament’s winter session starts, according to two government officials who asked not to be named. This money, part of the almost Rs2,000 crore support this fiscal, may be in the form of equity. The net loss of Air India (AI) stood at Rs5,548 crore in fiscal 2009, it said on Wednesday.
AI has been seeking an equity infusion since last year. Its current equity stands at Rs145 crore.
The GoM was given a presentation on AI’s plans to reduce costs and enhance savings by chairman and managing director Arvind Jadhav and civil aviation secretary M. Madhavan Nambiar. The meeting was also attended by Patel, petroleum minister Murli Deora, home minister P. Chidambaram and deputy chairman of the Planning Commission Montek Singh Ahluwalia.
12/11/09 Tarun Shukla/PTI/Live Mint

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Categories: NACIL Nov 2009