New Delhi, Jul 14 (IANS): The government is committed to revive Air India, the cash-strapped national carrier, a senior civil aviation ministry official said Thursday.
"The government is committed to Air India. We are bound by that commitment to revive Air India," Nasim Zaidi, secretary, ministry of civil aviation, told reporters on the sidelines of an industry summit.
According to him, the national carrier's Rs.40,000 crore worth of debt would be cleared in a time-bound manner.
"Air India's debts would be cleared in a time-bound manner," Zaidi said without specifying any time frame for clearing the massive debt the airline has accumulated for aircraft acquisition and operations funding.
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 in July.
The cash-strapped carrier is also seeking a total infusion of Rs.17,000 crore, which includes Rs.5,000 crore for this fiscal year alone.
Earlier, the government had infused Rs.4,000 crore in the previous two fiscal years. The airline was also promised another tranche of Rs.2,000 crore this year in the federal budget.
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, are under review of a group of ministers (GoM) headed by Finance Minister Pranab Mukherjee.
The GoM is expected to meet July 18.
Prime Minister Manmohan Singh has said he has asked the ministerial group overseeing the turnaround of the debt-ridden national carrier to come out with their recommendations fast.
"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 plan envisages further equity inclusion, conversion of short-term loans into long-term debt and hiving-off the company's maintenance and ground-handling arms.