Air India earns Rs36 crore daily, spends Rs57 crore a day

Explaining the precarious financial health of the national carrier, the government yesterday said Air India earned Rs36 crore a day from its operations while its expenses amounted to Rs 57 crore a day.

"We are paying compulsory payment abroad of Rs16 crore and committed payment in India is Rs20 crore. But the total expenditure comes to about Rs57 crore," civil aviation minister Vayalar Ravi said in Lok Sabha during the Question Hour.

Air India has a major payment problem on it hands as regards its dues to aviation fuel to oil companies. The company's overdues to oil PSUs have shot to upward of Rs2,280 crore as on February this year.

"The government has infused Rs. 1,200 crore, out of this, we have given Rs. 475 crore to the oil companies. As it is, it is true that Rs. 1,900 crore is still pending," he said.
Now forced to pay cash against fuel supplies, it pays Rs12.5 crore daily to keep its planes airborne. So far, the carrier has paid Rs1,147.5 crore in daily payment. Ravi told parliament that oil companies had been requested to extend credit to AI as they do to private carriers, but the oil companies have refused to oblige.

In reply to a question as to whether the government was considering measures to ensure that private airlines covered all the Indian sectors in an appropriate manner to increase aviation connectivity, Ravi replied that Route Dispersal Guidelines had been laid down with a view to achieve better regulation of air transport services covering various regions in the country.

"It is, however, up to the airlines to provide air services to specific places depending upon the traffic demand and commercial viability. Airlines are free to operate anywhere in the country subject to compliance of the Route Dispersal Guidelines issued by the government," Ravi said.