More funds sought for ailing Air India

Written by: Pti
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New Delhi, Feb 15 (PTI) The Civil Aviation Ministry todaysought more budgetary support for Air India claiming thatalmost 65 per cent of the turnaround plan of the ailingnational carrier has been implemented.

The issue of additional support was raised by CivilAviation Minister Vayalar Ravi at a meeting here with FinanceMinister Pranab Mukherjee, during which the two leadersdiscussed issues pertaining to the aviation sector in theupcoming Budget.

"We informed him that whatever decision had been taken, wehave implemented almost 65 per cent of it and something moreis to be implemented," Ravi told reporters after the hour-longmeeting.

Regarding government guarantees on the hefty loans AirIndia has taken to fund its fleet acquisition, he said, "Theguarantee has to come .... because the RBI, the SBI need somekind of assurance. All financial matters were discussed."

He said certain clarifications had been sought by FinanceMinistry officials. The replies would be sent soon so that afinal decision on the matter could be taken at the earliest.

Asked whether the Ministry has asked for additional equityinfusion of Rs 2,000 crore, he said, "I have asked for littlemore money, I cannot tell you how much."

To further queries, he said the estimated amount had beengiven by Deloitte, the consultancy firm appointed by Air Indiato go into its turnaround plan. "We want more money if we canget more."

Asked about Mukherjee''s response, Ravi said the governmentwould help Air India but it would come "depending on how weare progressing step by step. So it means we have to earn moremoney and gradually reach the break-even point."

Air India has so far received a total of Rs 2,000 crore asequity in two tranches and earlier reports said the CivilAviation Ministry has sought another Rs 2,000 crore in thenext financial year.

Official sources said a provision for at least Rs 1,200crore worth of equity could be made in the 2011-12 budget andanother tranche could be given in the supplementary budgetlater this year.

Asked about the remaining priorities of Air India''sturnaround plan, Ravi said a major issue was that ofintegration of employees and assets of the two erstwhilepublic sector carriers -- Indian Airlines and Air India.

"I said give me some time. My first priority is myemployees. Integration is the main point. Routes also. I amgoing to look into pricing of tickets also," the Ministersaid.

He said the headquarters of Air India Express would alsobe shifted "because that is a major area... we are confidentthat we can make good profit from Air India Express. One byone only I can do." .

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