Mumbai: A threat by Indian Oil Corp (IOC) to stop jet fuel supplies to Air India at some airports was resolved after a late Monday evening intervention from the ministry.
The state-run refiner threatened to stop supplies at six airports, including Pune, Vizag and Chandigarh, due to payment defaults by the airline, said a senior executive.
The issue was later sorted after a meeting with aviation ministry officials, said an Air India spokesman.
The cash-strapped airline has been struggling to make payments. It had a debt of more than Rs 54,000 crore last year when the government tried to sell a 76% stake in the airline. The government then transferred about Rs 29,000 crore of working capital debt into a special purpose vehicle — Air India Asset Holdings (AIAHL).
With this, the airline’s annual interest payment liability had come down from Rs 4,400 crore to about Rs 1,700 crore. Total debt of the carrier, including that taken over by the government, has increased to over Rs 58,000 crore now. The government has announced a bond issue of Rs 7,000 crore to be raised by AIAHL, which will be used to repay the national carrier’s debt that has been transferred to the SPV.
16/07/19 Economic Times
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The state-run refiner threatened to stop supplies at six airports, including Pune, Vizag and Chandigarh, due to payment defaults by the airline, said a senior executive.
The issue was later sorted after a meeting with aviation ministry officials, said an Air India spokesman.
The cash-strapped airline has been struggling to make payments. It had a debt of more than Rs 54,000 crore last year when the government tried to sell a 76% stake in the airline. The government then transferred about Rs 29,000 crore of working capital debt into a special purpose vehicle — Air India Asset Holdings (AIAHL).
With this, the airline’s annual interest payment liability had come down from Rs 4,400 crore to about Rs 1,700 crore. Total debt of the carrier, including that taken over by the government, has increased to over Rs 58,000 crore now. The government has announced a bond issue of Rs 7,000 crore to be raised by AIAHL, which will be used to repay the national carrier’s debt that has been transferred to the SPV.
16/07/19 Economic Times
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