Several options available to restore Air India’s financial health: Minister
The order to purchase of 111 aircraft costing about Rs 70,000 crore may have benefited foreign aircraft manufactures with substantial financial loss to the already stressed national carrier, sources said.
The troubles of India’s national air carrier are well known.
Finance Minister Arun Jaitley had said in an interview last week that government is looking for a strategic investor in Air India. Air India reported a loss of about Rs3,587 crore in 2015-16, compared with a loss of Rs5,859 crore in the previous fiscal year. “Niti Aayog has suggested steps for a strong and viable airline”, said Raju at a press conference recently. “I would not like to close any option”, Raju said.
The state-owned airline has a debt of about Rs50,000 crore, of which about Rs25,000 crore are loans taken to buy aircraft.
The agency registered the first case against Ministry Of Civil Aviation (MoCA), its official and Air India and private person under Sections 120B, 420 of Indian Penal Code and Prevention of Corruption (PC) Act alleging that irregularities were found in purchase of 111 aircrafts.
Asked whether Ministries of Finance and Civil Aviation were on the same page on disinvestment, he said there is no point in viewing this issue in a compartmentalised fashion, saying the government has to be taken as one unit.
India’s Central Bureau of Investigation (CBI) has launched a preliminary enquiry into the merger of Air India (AI, Mumbai Int’l) and Indian Airlines (IC, Delhi Int’l) in 2007, reports The Economic Times.
Air India is surviving on a Rs 30,000 crore bail-out package, spread over 10 years, announced by the Manmohan Singh government in 2012.
Loss-making Air India has seen much of its market share disappear to fast-growing private local carriers and worldwide airlines in the last decade.
However, today Raju posed the glaring reality check about low buyer interest, even as he laid out that the government is considering all options to bring back Air India into good financial health and taking the debt burden off the shoulders of the government.