Cash-Strapped Air India Holds Board Meeting
New Delhi: A board meeting of the cash-strapped Air India was held on Friday, amid reports of the government mulling over a financial package to help the carrier. The meeting comes in wake of the failure of proposed strategic disinvestment of the airline. On the other hand, the government is considering a proposal for equity infusion and possible loan waiver to improve the finances of the national carrier.
Interestingly, this is the first board meeting to have taken place after the inclusion of leading industrialists viz. ITC Chairman YC Deveshwar and Aditya Birla Group Chairman Kumar Mangalam Birla as independent directors of Air India. While the former was seen in attendance at the meeting, the latter did not turn up.
As per sources, the Civil Aviation Ministry and the Finance Ministry are in talks for a Rs 110 billion bailout package for the ailing Air India. This amount will be utilised to reduce the high-cost working capital loans. Reports also suggest that Air India may seek a loan waiver.
Notably, as of March 2017, Air India had a debt burden of over Rs. 480 billion out of which Rs 173.6 billion was owed to aircraft leasing companies. Civil Aviation Secretary R N Choubey had earlier stated that the central government is seeking to make the national carrier competitive before taking a fresh leap towards disinvestment proposal.