Air India lost Rs7,226 crore in last two financial years

Air India had incurred losses to the tune of Rs7,226 crore, including a loss of Rs2,226.16 crore during the financial year 2007-08 and an estimated loss of around Rs5,000 crore in the year 2008-09.

Giving this information in the Rajya Sabha today, civil aviation minister Praful Patel said the losses were mainly due to the prevalent economic recession and low yields as also load factors.

The national carrier has been incurring losses since 2004-05, the minister said, adding that the new holding company of the two national carriers, the National Aviation Company of India Ltd (NACIL) has taken several cost-reduction and revenue-enhancing initiatives focusing on the turnaround of the company.

He said the committee of secretaries has taken note of the proposals for restructuring of Air India. The government will arrive at a decision upon those proposals.

On the expansion of air services during the 11th Plan, the minister said, "the government has laid down route dispersal guidelines with a view to achieve better regulation of air transport services taking into account the need for these services of different regions, including the north-eastern region."

It was up to the airlines to provide services to specific places and they are free to operate anywhere in the country subject to compliance of rule dispersal guidelines issued by the government, he added.