Debt-laden Air India has received Rs 27,195.21 crore worth equity infusion till date from the government under the turnaround and financial restructuring plans approved back in 2012.
Debt-laden Air India has received Rs 27,195.21 crore worth equity infusion till date from the government under the turnaround and financial restructuring plans approved back in 2012. In the current financial year, the state-owned airline received an equity infusion of Rs 650 crore up to June, Minister of State for Civil Aviation Jayant Sinha told the Lok Sabha today. A Turnaround Plan (TAP) as well as a Financial Restructuring Plan (FRP) were approved for Air India by the previous UPA regime in 2012.
All government guaranteed loans and interests thereon are being paid by the government by way of equity infusion into the airline, Sinha said in a written reply.
The minister said that under the FRP, high cost of working capital loans have been converted into long term debt carrying lesser rates of interest so as to reduce the financial burden on Air India. “The TAP/ FRP includes budgetary support amounting to Rs 30,231 crore spread over 10 years ie. up to FY 2020-21 and also equity support for the payment of principal/ interest of the non-convertible debentures.
“Air India has received an equity infusion of Rs 27,195.21 crore till date,” Sinha said. At the end of March 2017, the national carrier had a debt burden of more than Rs 48,000 crore. The government’s proposed strategic disinvestment of Air India failed to take off in May. Against this backdrop, Sinha said the government remains committed to the disinvestment of Air India.
“In view of volatile crude prices and adverse fluctuations in exchange rates, the present environment is not conducive to stimulate interest amongst investors for strategic disinvestment of Air India in immediate near future.
“The issue would be revisited once global economic indicators, including oil prices and forex conditions stabilise,” the minister said.