On Thursday, the central government sought approval from Parliament for equity infusion worth Rs 2,345 crore into struggling Air India and another Rs 1,300 crore for Air India Asset Holding.
In a bid to revive the financial fortunes of the national carrier, the government has decided to transfer debt worth Rs 29,000 crore to Air India Asset Holding Company, a special purpose vehicle.
Apparently, the airline has debt worth around Rs 55,000 crore.
Notably, in the second batch of Supplementary Demands for Grants 2018-19 tabled by Finance Minister Arun Jaitley in the Lok Sabha, approval has been sought for Rs 2,345 crore equity infusion into the airline under a turnaround plan.
Apart from transferring debt of the ailing airline, Parliament’s nod has also been sought for providing grants-in-aid of Rs 1,300 crore to Air India Asset Holding.
The government’s strategic stake sale offer for Air India failed to attract any bidders earlier this year, and since then, various other options are being explored to improve the financial position of the national carrier.
According to reports, Air India is staying afloat on a bailout package extended by the previous UP regime. From 2012, the 10-year bailout package began.
Also, Air India is to receive up to Rs 30,231 crore from the government subject to meeting certain performance thresholds, as part of the turnaround plan.
In order to meet the additional gross expenditure of Rs 85,948.86 crore for the current fiscal ending March 2019, the government has sought Parliament’s approval on the same.