Air India on verge of acquiring NPA status
28 July 2011
Mumbai: Lurching from crisis to crisis, state-owned Air India (AI) now finds its interest liability grown to around Rs700 crore for the April-June period after failing to pay lenders for the third month in a row. The badly struggling carrier is now teetering at the edge of being declared a non-performing asset (NPA) in the books of the 22 banks which have lent it money.
It lenders include the State Bank of India and the ICICI Bank.
The airline must clear payments before the end of this month, or else its dues will be categorised as NPAs.
The carrier is now desperately awaiting infusion of equity and also clearance of outstanding amounts by the Government of India to escape the latest trap.
According to senior AI officials, they are awaiting clearance of outstanding amounts by the ministry of finance, which amount to a total of Rs1,732 crore. Of this, Rs1,200 crore is additional equity infusion and Rs532 crore is the amount owed by the Government to Air India for VVIP services.
These payments have already been received in-principle approval from a Group of Ministers, but final approval is expected only on 17 August when it meets again.