Fresh infusion of Rs800 crore for Air India: Patel
03 February 2010
Air India, the loss-making national carrier may soon get another bailout from the Indian government with a Rs800 crore capital infusion this time around, said the civil aviation minister Praful Patel today.
Speaking to reporters after a group of ministers' meet today, Patel said that his ministry will put forward a proposal to the cabinet next week for Rs800 crore capital infusion into Air India.
His statement came after a meeting held today by an empowered group of ministers (E-GoM), headed by finance minister, Pranab Mukherjee, to decide on further equity infusion into the national carrier.
After securing an initial Rs800-crore bailout for Air India, Praful Patel had said last month that was hopeful that the government would infuse "more" equity in the national carrier in the near future. (See: Air India to receive additional equity soon: Patel)
Last month, The National Aviation Company of India Ltd (NACIL), the holding company for national carrier, Air India, has secured a $1.1 billion loan from the Export-Import Bank of the US (Ex-Im Bank) for financing of aircraft sold by Boeing to Air India.
The loan was secured after the Indian government had provided Ex-Im Bank with a sovereign guarantee.
Patel had dismissed as "completely baseless" recent reports that the government was mulling demerging Air India and Indian Airlines, the combined entity which today constitutes the NACIL. (See: Move afoot to demerge Air India)