Air India holds first meet with RBI

After receiving instructions from the Group of Ministers (GoM) to have their corporate debt restructuring (CDR) plan vetted by the Reserve Bank of India, embattled flag carrier Air India made the first move in this direction setting up a meeting of its top management brass with top honchos of the RBI. Also in attendance was SBI Caps managing director and chief executive S Vishvanathan.

The Air India delegation included its chairman and managing director, Rohit Nandan, and secretary, ministry of civil aviation, Nasim Zaidi.

There were conflicting reports whether or not the delegation made a presentation to the central bank, with some delegation members reportedly saying that theirs was a goodwill visit.

At its much-awaited meet on 28 October, the GoM tasked to look at Air India revamp asked the airline to get its financial restructuring plan vetted by RBI within a week. "A report on the Air India debt restructuring prepared by the committee of officers will be reviewed by RBI within a week. Only after that will any decision be taken," aviation minister Vayalar Ravi said after the meet.

The SBI Caps restructuring plan has been hanging in the air since last October.

The debt-ridden national carrier has outstanding loans and dues of Rs67,520 crore, of which Rs21,200 crore is working capital loan, Rs22,000 crore long-term loans on fleet acquisition, Rs4,600 crore of vendor dues and an accumulated loss of Rs20,320 crore, latest official figures showed.

A consortium of banks, which are prime lenders to the struggling carrier, include state-run banks like the SBI, PNB, IDBI Bank, and the Syndicate Bank.

In 2010 alone, the airline reported a loss of nearly Rs7,000 crore.