Tuesday, February 01, 2022

Centre allocates Rs 9,259 crore to special purpose vehicle Air India Assets Holding

The Centre has allocated Rs 9,259 crore to AIAHL, a government-owned special purpose vehicle set up to handle Air India's debt and non-core assets, for the next financial year starting from April 1, according to a budget document. In the budget speech on Tuesday, Finance Minister Nirmala Sitharaman said the revised estimate of capital expenditure for this fiscal is Rs 6.03 lakh crore. This includes an amount of Rs 51,971 crore towards settlement of outstanding guaranteed liabilities of Air India and its other sundry commitments, she added.

Air India Assets Holding (AIAHL) was set up in 2019.

"The provision (of Rs 9,259 crore) is kept for servicing of loan transferred to special purpose vehicle as a result of financial restructuring of Air India," the document said.

In 2021-22, the Centre infused an equity of Rs 62,057 crore in AIAHL in order to clear Air India's pending dues before its disinvestment.

Moreover, Air India was given a grant-in-aid of Rs 1,944 crore and loans of Rs 4,500 crore in 2021-22 to cover "cash losses during Covid period", the document said.

Air India was taken over by Tata Group firm Talace on January 27.

Through a competitive bidding process, the government sold loss-making Air India to Talace for Rs 18,000 crore. As part of the deal, Talace paid Rs 2,700 crore in cash and took over Rs 15,300 crore debt of the airline.

The remaining debt and borrowings of Air India were transferred to AIAHL.

As on August 31, 2021, Air India had a total debt of Rs 61,562 crore. The airline also had about Rs 15,000 crore excess liabilities towards unpaid fuel bills and other operational creditors.

01/02/22 PTI/Economic Times

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