Govt may pump in Rs 30,000 cr to save Air India

The state-run carrier is in the midst of a serious financial crisis

sweta-ranjan

Sweta Ranjan | November 22, 2011



Cash-strapped Air India may soon earn the lost credibility again. A panel of secretaries has voted in favour of providing support of Rs 30,000 crore in order to save the crippling Maharajah. The panel has also discussed the possibility of disinvestment of government stake once the beleaguered carrier turns profitable.

The panel of secretaries did an extensive exercise and explored seven other options before choosing the option of recapitalization plan.

As per the revival plan, the government hopes that it will take around six years for Air India to make cash profits. The panel has estimated that by financial year 2018 on equity infusion of Rs 30,231 crore, Air India will make profit.

The new plan will not allow the sinking Airline to induct new aircrafts besides Boeing 787. The plan also suggests that if required, additional aircraft could be acquired on lease but only after the profitability of a route is assessed.

Air India has been struggling to save its image even after incurring a loss of Rs. 600 crore a month.

The state-run carrier is in the midst of a serious financial crisis and has failed to pay salaries to its employees many a times in 2011. 

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