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Air India to get Rs.5,000 crore as budgetary support

  •   Thu, Feb 28 2013 07:18:59 PM

New Delhi, Feb 28 (IANS): Finance Minister P. Chidambaram Thursday proposed to pump in Rs.5,000 crore ($909.09 million) into ailing national carrier Air India in the next fiscal.

"Budgetary support of Rs.5,000 crore has been earmarked for equity infusion in Air India Limited," said the expenditure budget presented to the Lok Sabha for the financial year starting April 1, 2013.

In his last budget (2012-13), then finance minister Pranab Mukherjee had allocated Rs.4,000 crore for the flag carrier.

The flag carrier has received substantial support from the government to revive itself under the turnaround and financial restructuring plan which were approved by the union cabinet last year.

Under the turnaround and financial restructuring plans includes equity for cash deficit support of Rs.4,552 crore till fiscal 2021, equity for already guaranteed aircraft loan of Rs.18,929 crore till fiscal 2021.

The national carrier is expected to start generating profits from normal operations by the end of the current fiscal March 31, according to the Economic Survey 2012-13 tabled in the parliament Wednesday.

The survey said that the airline has been able to achieve targets set in the turnaround plan and is expected to become EBIDTA (earnings before income, taxes, depreciation and amoritisation) positive.

Meanwhile, other government aviation bodies such as the Airports Authority of India (AAI) has been allocated Rs.42 crore, out of which Rs.32 crore has been earmarked for its project at Pakyong airport, Sikkim.

The aviation regulator, the Directorate General of Civil Aviation (DGCA), has been allocated Rs.30 crore to pursue its plan schemes.

In last year's budget AAI had been allocated Rs.280 crore, out of which Rs.80.52 crore has been earmarked for airport development in the northeastern states. While, DGCA had been provided Rs.60 crore.

Other provisions in the budget include Rs.10 crore for the Bureau of Civil Aviation, while Rs.5 crore has been provided to Hotel Corporation of India for renovation of its hotels and flight kitchen.

Aero Club of India has been provided grants-in-aid of Rs.eight crore.
  

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Comment on this article

  • Evans Christopher Sumitra, Udupi/New York, USA

    Fri, Mar 01 2013

    This AIR INDIA is for the politicians and the staff to travel free of cost. Then why pump in more money. Instead of that close the airlines and let someone take over to run it efficiently. All these years you showed only losses and then why put in more tax payers money.

    DisAgree Agree Reply Report Abuse

  • Nagesh Nayak, Urva

    Fri, Mar 01 2013

    Provision only for minister and politicians favour. Not for AAM INDIAN. Example we all well aware. What was happend and what is going on with MANGALORE AIR CRASH vicitm's family. Aviation Dept not even ready to take or to accept court notice still now reject by aviation Dept. Seems they waiting for MARCH /19th Supreme Court Verdict about Strict Liability. This is a small portion expression from my side. Hope very soon remaining facts revealed by the right end.

    DisAgree Agree [1] Reply Report Abuse

  • K. MATHEW, mangalaore

    Fri, Mar 01 2013

    last year 4000 this year 5000 core. How many aaammm adddmi know the cores value - 9000 core - where this money coming from? AI is like dogs tail. Never get straight dogs tail. at lease some one can enjoy with 9000 core- how many ammm admmi ride with air india and what is the use of pumping out 9000core? even the opposition not making any comment - o this is shared by the MP and MLS ammm admi have same roti and same kapada - now cannot imagine for makkaaan = hahah good budget?

    DisAgree Agree [2] Reply Report Abuse

  • Ashok Kotian, Mangalore / Mumbai

    Fri, Mar 01 2013

    Whose money is being pumped in this useless Air India which is full of incompetent staff? It is a question of WHY.

    DisAgree Agree [4] Reply Report Abuse

  • siddapur abdul raheeman saheb, siddapur/karnataka/saudia

    Fri, Mar 01 2013

    Which airlines will provide facility like travel now pay later to our politians if Air India is privatised?

    DisAgree Agree [3] Reply Report Abuse

  • stan, dubai

    Fri, Mar 01 2013

    Indians has give respect to our National carrier . This is just like the patient in Oxygen so we must support paying Hospital bills to keep him alive whether he is useful or useless.

    DisAgree Agree [4] Reply Report Abuse

  • G.Sadananda, Mlore/Mumbai

    Fri, Mar 01 2013

    @Bulsam. The answer is very simple...no Govt (UPA or NDA)will ever let go of AirIndia their milking cow. The private airlines will will not provide them the facilities nor benefits that AirIndia is OBLIGED to.

    DisAgree Agree [4] Reply Report Abuse

  • Ozy, Mumbai

    Fri, Mar 01 2013

    From here the politicians can loot very easily, its a waste

    DisAgree Agree [2] Reply Report Abuse

  • A. S. Mathew, U.S.A.

    Fri, Mar 01 2013

    Air India is being mainly used as a carrier for the politicians and
    bureaucracy, and the tax payers will have to undertake this huge expense. How long it will take the government of India to understand that running an airline, whether making profit or not, is not the responsibility of the government? How long, the tax payers will have to feed this old white elephant?

    DisAgree [1] Agree [3] Reply Report Abuse

  • Gurudath, M'lore/Mumbai

    Thu, Feb 28 2013

    A poor country like India is wasting its resources supporting such a white elephant. Either close it down or give it back to the TATAs if they are ready.

    We also need to change labour laws so that excess staff can be compulsorily retired.

    DisAgree Agree [7] Reply Report Abuse

  • Bulsam, Mangalore

    Thu, Feb 28 2013

    Till 2006 Air India was making profits but later on it started making huge losses. Why? By March 2011, Air India had accumulated a debt of 42,570 Crore (US$7.75 billion) and an operating loss of 22,000 Crore (US$4 billion), and was seeking 42,920 Crore (US$7.81 billion) Crore from the government. Why?
    The Indian government was pressing ahead with "economy-wide" privatization, selling 60% stake in Air India and a 51% stake in Indian Airlines. Why that did not materialise?
    Have you heard of a company that makes a financial commitment of Rs 55,000 Crore for purchase of 111 aircraft on an equity base of Rs 145 Crore and carry-forward losses of Rs 776 Crore on March 31, 2006? A new fleet was indeed acquired for the airline but with almost no planning.
    The biggest mistake relating to Air India was the decision to merge the erstwhile Indian Airlines into the flagship carrier. Again, when Arvind Jadhav took over as managing director of Air India he quashed the recruitment of additional cabin crew after the process for it had been nearly completed. As a result, another eight months were spent hiring cabin crew. During this period hundreds of flights had to be either cancelled or were delayed, not because of a lack of pilots or planes but because of a lack of crew.
    There was always the experts view in favour of privatisation of Air India, if not full privatisation, at least a partial one can be carried out through disinvestment. This will bring in funds to run the airline instead of the government constantly raiding taxpayers' money to feed it. Instead of further bleeding the tax payer’s money, why the Govt is not going ahead with disinvestment?

    DisAgree Agree [12] Reply Report Abuse


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