NEW DELHI: The government today announced Rs 5,000 crore additional equity infusion for debt-ridden national carrier Air India in the next fiscal as part of its turn around plan.
"Rs 5,000 crore (has been marked) for equity infusion in National Aviation Company of India Ltd (now Air India Ltd)," according to
Budget documents.
Air India will also be able to generate Rs 1,318.60 crore through internal and extra budgetary resources (IEBR) in 2013-14, it said.
In April, 2012, the government had approved a turn around plan and a financial restructuring plan for improving the operational and financial performance of Air India as its losses had increased considerably to Rs 7,853 crore in 2011-12 from the levels of Rs 5,548.26 crore in 2008-09.
The turn around plan included Rs 30,000 crore equity infusion over a nine-year period starting 2012-13.
Accordingly, Rs 4,000 crore was earmarked for Air India in this fiscal's Budget, which was later increased to Rs 6,000 crore in the revised estimates.
In 2011-12, the airline was given a Budgetary support of Rs 1,200 crore, so that it can improve its financials and performance.
Yesterday, Civil Aviation Minister Ajit Singh had told Lok Sabha in a written reply that the national carrier has turned EBITDA (Earnings Before Interest, Depreciation, Tax and Amortization) positive to the tune of Rs 48.75 crore between April and December 2012.
In the first nine months of the current fiscal, Air India has earned an operating revenue of Rs 11,400.44 crore while its operating expenses were Rs 13,954.47 crore, resulting in an operating loss of Rs 2,554.02 crore, Singh had said.
The Economic Survey for 2012-13, tabled in Parliament yesterday, said that Air India is expected to achieve positive EBITDA in the current fiscal and its performance in the first six months has been in line with the target set in its turn around plan.
It had also said that the national carrier has registered all-round enhanced performance such as on-time performance at 85 per cent, passenger load factor at 70.9 per cent and yield at Rs 4.31 per revenue passenger kilometre during the April-October period.
According to the turn around plan of Air India, the national carrier was also allowed to issue government- guaranteed non-convertible debentures (NCDs) worth Rs 7,400 crore to its lenders, like financial institutions, banks, LIC and EPFO. These NCDs was to be used to repay part of the airline's close to Rs 21,200 crore working capital loans.
Besides, it was also permitted to induct 27 Boeing 787 Dreamliners and hive off its MRO (Maintenance, Repair and Overhaul) business and Engineering Services as two wholly-owned subsidiaries.
Source : timesofindia.indiatimes.com