Air India’s Provisional Loss Widens, Government To Go Ahead With Divestment
The government has also prepared a revival plan for the carrier says Civil Aviation Minister Hardeep Singh Puri.
Air India’s provisional loss widened in the previous fiscal even as the government infused more money in the national carrier.
The provisional loss of the national carrier to stood at Rs 7,635 crore in financial year 2018-19, Civil Aviation Minister Hardeep Singh Puri said in a written reply in Rajya Sabha on Thursday. This is the biggest loss posted by the airline in five years. The airline had reported a loss of Rs 5,348 crore in FY18.
The government, Puri said, has infused Rs 3,975 crore in the airline in FY19. The carrier’s net debt, however, stood at Rs 58,351.93 crore at the end of March 2019.
Puri said that so far an equity infusion of Rs 30,520.21 crore has been made from the government as part of the 2012 turnaround plan for the debt-ridden carrier. The plan entitled the airline to receive budgetary support from the government amounting to Rs 30,231 crore over a period of 10 years up to FY21, he said.
The government has also prepared a revival plan for the carrier which includes a comprehensive financial package to improve its financial health, Puri said. This includes transferring a debt of Rs 29,464 crore and the airline’s non-core assets to Air India Assets Holding Company Ltd., a special purpose vehicle.
The bilateral flying rights with five countries—the U.A.E, Hong Kong, Qatar, Singapore and United Kingdom—that were previously allocated to Jet Airways (India) Ltd. have now been temporarily given to Air India, the minister said.
Government Gives Nod For Divestment
The government has given its green signal to the sale of the debt-laden carrier after it showed an improvement in its financial and operational performance, a press release from the Civil Aviation Ministry said.
This came hours after Puri told the Parliament that the present economic environment was not conducive for Air India’s sale in the “immediate near future”.
The decision on the stake sale was deferred last year after it failed to attract any bidders.