Cash-strapped Air India could soon get equity infusion worth Rs 2,345 crore as part of the turnaround plan to meet its working capital requirements.
The government on Thursday sought Parliament’s nod to grant Rs 2,345 crore to the ailing carrier and `1,300 crore for Air India Asset Holding Company, the special purpose vehicles (SPV) housing airline’s debt. The proposal was part of second batch of supplementary demands for grants 2018-19 tabled by finance minister Arun Jaitley in the Lok Sabha.
Air India has been facing delay in disbursing salaries and few of its planes are grounded due to lack of spares.
The national carrier was supposed to get Rs 30,231 crore as per a 10-year bailout package announced in 2012. Air India has already received funds to the tune of `27,264 crore since then.
After a failed attempt to privatise Air India earlier in the year, the government is working on a new model to change Maharaja’s fortunes. The government last month decided to transfer `29,000 crore of Air India’s current debt of Rs 55,000 crore to the SPV.
Under this scheme, all non-core assets like land, buildings, etc belonging to Air India would be transferred to it. The funds raised through sale of these assets would be used to reduce the `29,000-crore debt, held in the SPV.
The government hopes to make the airline competitive before venturing into the strategic sale of the carrier again. A ministerial panel had recently cleared a proposal for strategic sale of AI’s ground handling subsidiary AIATSL.