Maharaja seeks oilman’s interest-free credit to remain in air

Ahead of a crucial government panel meet to decide on its proposed financial bailout, Air India, at a review meeting, has told the Civil Aviation Ministry that it was facing an acute liquidity crisis.
The airline is finding it difficult to repay loans and obtain fresh loans due to the liquidity crisis, the Air India top management told the ministry at the meeting taken by Civil Aviation Minister Vayalar Ravi on Monday. “The airline is considering ways to increase its cash flow,” Ravi told The Indian Express. The airline has also sought the Reserve Bank of India’s support for its financial restructuring proposal.
In addition to the Rs 26,000 crore bailout package which includes Rs 6,600 crore equity infusion, writing off a substantial chunk of Rs 40,000 crore debts and soft loans, the airline is likely to seek the Pranab Mukherjee-led Group of Ministers’ nod for continuation of interest free credit extended by the state-owned Oil Marketing Companies (OMCs) for another three months.
26/10/11 Smita Aggarwal/Indian Express

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Categories: Air India Oct 2011