New Delhi: Air India may soon be wheeled out of the ICU. A Group of Ministers (GoM) has recommended an equity infusion of Rs 23,000 crore into it, over 10 years. This includes Rs 6,600 crore for the current financial year.
Air India had asked for Rs 43,000 crore but the GoM, headed by the Finance Minister Mr Pranab Mukherjee, said that half the sum would do. The Cabinet will now have to approve the proposal.
A former Chairman and Managing Director of AI, Mr V. Thulasidas, felt that whatever amount the Government plans to provide should be made available in one go. “The Government can decide on the amount. Some amount can be provided as equity and the rest in the form of letter of comfort. Public sector banks could also be asked to pick up equity.
“But the funds should be provided only if the airline agrees to certain goals being achieved which help cut expenditure and increase revenues. They should also look at completing the merger process without further delay,” Mr Thulasidas added.
28/10/11 Business Line
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