Monday, October 22, 2018

Small savings to keep the Maharaja afloat

The taxpayer’s money being misused to keep Air India afloat is no news. But the government has done the unthinkable to bail out the failed carrier.
In a highly questionable move, the Maharaja has been granted Rs 1,000 crore from the National Savings Fund to meet operational expenses of the lossmaking carrier. The corpus of NSSF comprises contributions to various small savings like the Public Provident Fund, Sukanya Samriddhi Yojana and the Kisan Vikas Patra.
What is even strange is the government’s move to provide a fresh sovereign guarantee to Air India for raising loansworth Rs 500 crore.
Strangely, these moves come at a time when the airline’s debt and operational losses are mounting, raising questions on the rationale behind providing fresh funds from the taxpayer’s kitty.
Reports suggest that the government is proposing to make some big tweaks to the divestment plan to woo bidders. When the centre put the airline on the block last year, there were no takers with prospective bidders backing out citing some of the contentious bid terms.
22/10/18 Economic Times

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