Govt offers help to Air India with Rs 30,000 cr bailout

New Delhi, Nov 22: With the cash strapped Kingfisher airlines barely getting out of the financial crunch, the government has to deal with the financial woes of Air India. A panel of secretaries has voted in favour of providing support of Rs 30,000 crore to Air India. They are also looking into the chances of disinvesting the government stake till the airline churns out profit.

The capital pumping into the ailing airline is expected to face severe criticism from various quarters on the grounds that the govt is helping out the airline with the real intention of selling its stake later to private parties. This will also mark a stark contrast of the UPA's disinvestment policy that has avoided roping in private players even in loss-making public sector companies. It has been following a policy of letting go of the govt stake and later disinvesting it through public issue of shares.

The committee of secretaries arrived at the decision on the recapitalisation after exploring seven other options. The plan made by the group of secretaries predict that Air India will achieve profits by the financial year 2018 on equity infusion of Rs 30,231 crore. The plan forbids the carrier to induct any new aircraft, except Boeing 787 and if required aircraft could be acquired on lease. Also, the fresh induction will be possible only when the profitability of the route is established.

OneIndia News