The government has assured Air India of financial and other assistance urging the carrier to meet the targets spelt out in the new turnaround plan. The state-owned airline must improve on time performance (OTP), passenger load factor (PLF), capacity growth and monetise assets.
Air India chairman and managing director Aswani Lohani is understood to have asked the government to waive the guarantee fee charged to secure the airline’s loans and bonds. The airline also wants the government to provide for the shortfall in equity, support in the recovery of the dues for services provided to the VIPs and conversion of the long-term loans into equity.
The carrier is also believed to have requested for a rationalisation of the cost structure at the airports. Top government officials in an oversight committee meeting with executives of the state-run airline Air India took stock of the financial recovery and operational improvement of the airline under the existing turn around plan (TAP).
Out the above mentioned demands the union government has already given its nod for the conversion of the R10,500 cr worth long term bonds into equity. “The union government has already assured us of the help which will lead to the financial recovery of the airline. We have also appraised the government of the improvement in the operational aspects in the last two years,” added a senior official of the airline.
According to another official of Air India, senior bureaucrats were explained that achieving 93% OTP which was a part of the TAP was not possible as the airline is a network carrier and delay in one flight also makes the connecting flight late which brings down the overall OTP.
Air India inks pact with Spicejet
Air India has finally succeeded in roping-in a private airline to use the maintenance repair overhaul (MRO) facility at the SEZ in Mihan here. An MoU was signed by Air India Engineering Services CEO H R Jagannath and Spicejet vice president Arun Kashyap in the presence of top AI officials on Tuesday.