Air India looks for Rs200 billion in aid from government
27 July 2009
The National Aviation Company of India is looking to secure Rs200 billion as aid from the government as it struggles against losses and downturn.
According to reports, it may require an equity funding of Rs25 billion to Rs30 billion a year for the ensuing four years.
Earlier, it had asked the Indian government for a Rs14,000-crore bailout package last month. (See: Air India may get Rs2,500-crore bailout)
SBI Caps had earlier submitted a Rs100 billion equity request to the committee of secretaries, and an equal amount to be raised through bonds or soft loans. The committee has asked the finance ministry to consider the demand for aid.
Air India has also presented to the committee its revenue estimates and cost cutting measures. The company has been asked to improve its performance on these two accounts as a pre-condition for financial aid.
The aid being sought this year is five times the amount the company has asked for in October 2008. Last year it has sought Rs1,231 crore in equity and Rs2,750 crore in soft loan over 15 years.