Monday, July 08, 2019

No dole, Air India still hopes to fly high

New Delhi: Air India is ready with a plan to maximise its revenues and reduce costs so as to repay debt of Rs 4,500 crore this fiscal even as the Union budget has not allocated any funds for the national carrier, two officials said.
“Air India will have to increase its revenues by about 10% and reduce its cost by about same percentage to be able to raise the amount to repay its debt of about Rs 4,500 crore,” a senior government official told ET on condition of anonymity.
As per the proposed plan, the airline will launch new flights and increase its presence on profitable routes, the sources said. The airline is getting some benefit of the grounding of Jet Airways that has led to its premium class occupancy increase substantially on the international as well as domestic routes.
The government has already taken over Air India’s debt of over Rs 29,000 crore, thus, reducing the annual interest repayment burden for the airline by about Rs 2,700 crore.
It “is highly unlikely to offer anything extra to the airline”, said the second official cited earlier.
Finance minister Nirmala Sitharaman did not announce any fresh fund infusion in the airline during her budget speech on Friday. Instead, she reiterated the government’s intent to divest stake in Air India.
08/07/19 Mihir Mishra/Economic Times

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