AI may have to wait till Sept for next tranche of govt funds

With the release of Rs 1,084 crore,the national carrier will receive a total of Rs 5,200 crore of the Rs 6,750 crore equity infusion announced for the current fiscal. Of the Rs 5,200 crore,Rs 1,200 crore was released in the last fiscal and Rs 2,916 crore has already been released in three installments in the current fiscal.

However,the infusion of the remaining Rs 1,550 crore of Rs 6,750 crore has been delayed due to the government’s decision to delay the supplementary budget. “As the approval for Rs 1,550 crore was to come through the supplementary budget,it may only come by the end of this fiscal,” the official said.

In a bid to bailout the cash-strapped Air India,the government had announced a support of Rs 30,231 crore over a period of nine years till 2020-21 that includes an infusion of Rs 6,750 crore in the first year.

Apart from equity infusion,as part of the bailout package,the government had also approved restructuring of its short-term debt by converting a large chunk of it into long-term with a moratorium of one year and repayment of the rest through a bond issue with government support.

It has also approved formation of two subsidiaries for ground-handling and engineering,and shifting of over 19,000 of the 27,000 permanent employees to these new operations.

Air India,which is under huge accumulated losses of Rs 20,000 crore and debt on its books of over Rs 43,000 crore,has shown improvement in its revenue income. Despite the recent strike,t he national carrier has shown 18 per cent growth in passenger revenue during the first quarter of the current fiscal which had crippled most of its international operations. But the international passenger revenue,which was impacted by the strike,grew by mere 2 per cent.