Govt foots VVIP flight bill, pays AI Rs 250 cr

Mumbai: The Union government has paid Air India Rs 250 crore for using its aircraft for VVIP charters and evacuation flights. The amount, which was due since 2008, was released on Friday.
Air India is facing a severe cash crunch and is being forced to cancel and combine domestic and international flights, after oil companies had refused to give it additional credit last month. The carrier has agreed to clear the dues of GMR-run Delhi and Hyderabad airports after it was warned it would lose its credit facilities and would have to follow a cash-and-carry mode.
Air India staff has not received its salary for May and allowances for the last two months. "We hope to receive our salaries now,'' said an Air India official.
The government owed Rs 323 crore to Air India for VVIP charters and evacuation flights, and the remaining amount would be cleared soon, said a government official. Air India has demanded that the government clear Rs 800-crore dues towards staff costs and the maintenance of Boeing 747-400 aircraft, which are used for VVIP flights, a demand the government is yet to agree to. The airline says since these aircraft are largely used for VVIP flights, the government must bear the cost.
11/06/11 Business Standard

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Categories: Air India Jun 2011