New Delhi: The fiscal concerns of the Narendra Modi government have taken a toll on national carrier Air India's equity infusion with the finance ministry informing the airline that it will not get Rs 720 crore of the Rs 6,500 crore scheduled for the current fiscal.
"The government is cutting the budget of all the ministries to achieve its fiscal deficit target of 4.1 per cent for the current fiscal. Of the total Rs 6,500 crore, AI will not get Rs 720 crore in this fiscal due to fiscal constraints," said a senior government official. He added that the airline has already got a little over Rs 5,500 crore for the current fiscal and has received over Rs 18,400 crore from the government till date.
The equity infusion is part of the over Rs 30,000 crore equity infusion till 2020 announced by the government in April 2012. The support has now increased to Rs 49,500 crore after the government provided a sovereign guarantee to the non-convertible debenture issue floated by the airline to repay bank loans and the repayment will go on till 2032. A senior Air India official explained that the equity infusion is mainly being used to repay loans taken by the national carrier to pay for its aircraft ordered in 2005.
22/12/14 Mihir Mishra/Economic Times
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"The government is cutting the budget of all the ministries to achieve its fiscal deficit target of 4.1 per cent for the current fiscal. Of the total Rs 6,500 crore, AI will not get Rs 720 crore in this fiscal due to fiscal constraints," said a senior government official. He added that the airline has already got a little over Rs 5,500 crore for the current fiscal and has received over Rs 18,400 crore from the government till date.
The equity infusion is part of the over Rs 30,000 crore equity infusion till 2020 announced by the government in April 2012. The support has now increased to Rs 49,500 crore after the government provided a sovereign guarantee to the non-convertible debenture issue floated by the airline to repay bank loans and the repayment will go on till 2032. A senior Air India official explained that the equity infusion is mainly being used to repay loans taken by the national carrier to pay for its aircraft ordered in 2005.
22/12/14 Mihir Mishra/Economic Times
