Ministerial panel on Air India to meet next week: Ravi

July 18th, 2011 - 6:15 pm ICT by IANS  

Pranab Mukherjee New Delhi, July 18 (IANS) The group of ministers (GoM) looking into the issue of equity infusion and revival of national carrier Air India met here Monday and has decided to meet again next week, Civil Aviation Minister Vayalar Ravi said.

“The GoM will meet again next week to take a final decision on the matter of more equity infusion,” Ravi told reporters here after the end of the GoM meeting headed by Finance Minister Pranab Mukherjee.

According to Ravi, a consensus had been reached at the meeting to expedite the equity infusion and to implement the revival plan for the flag carrier.

The date for the next GoM meeting was not disclosed.

Air India’s turnaround plan (TAP) and financial restructuring plan (FRP), which have been prepared by the State Bank of India’s financial advisory arm SBI Caps, is under the consideration of the GoM.

Currently, the airline, laden with a cumulative debt of Rs.40,000 crore it incurred over aircraft acquisition and as short-term loans to maintain its operations, expects a fresh equity infusion of Rs.1,200 crore followed by dues of around Rs.530 crores for operating VVIP flights.

The GoM is expected to take a final call on this in its next meeting.

The cash-strapped carrier is also seeking a total infusion of Rs.17,000 crore, which includes Rs.5,000 crore for this fiscal alone.

Earlier, the government had infused Rs.4,000 crore in the previous two fiscals. The airline was also promised another tranche of Rs.2,000 crore this year in the union budget.

Prime Minister Manmohan Singh has asked the ministerial group overseeing the turnaround of the debt-ridden national carrier to quickly come out with its recommendations.

“I will request (Finance Minister) Pranab Mukherjee to take expeditious decisions in the (Air India turnaround) matter,” the prime minister told a group of editors from the print media June 29.

The TAP envisages further equity inclusion, conversion of short-term loans into long-term debt and hiving-off the company’s maintenance and ground-handling arms.

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