Air India seeks Rs 2,400 crore govt guarantee to raise funds

New Delhi: Facing acute financial crunch, Air India has sought Rs 2,400 crore guarantee from the government to raise fresh funds to mainly meet its operational requirements, according to airline officials.

One of the officials said there is a delay in payment of salaries for the month of November and is expected to be paid on Thursday.

The government is in the process of finalising the contours for divestment of debt-laden Air India.

The officials said the airline has asked for Rs 2,400 crore sovereign guarantee in order to raise money to mainly meet its operational requirements.

They said the amount of Rs 2,400 crore is part of the Rs 7,600 crore guarantee that was to be provided to the airline in the current fiscal.

An Air India spokesperson did not offer any comment on the issue.

On November 27, Minister of State for Civil Aviation Hardeep Singh Puri told the Rajya Sabha that interests of Air India employees would be protected and there would be no job loss till its privatisation.

"Your airlines would have to be closed down, unless not privatised," he had said.

Air India's net loss in 2018-19 is provisionally estimated to be Rs 8,556.35 crore.

The Air India Specific Alternative Mechanism (AISAM) has approved re-initiation of process for the the government's 100 per cent stake sale in Air India along with Air India Express and the carrier's stake in joint venture AISATS.

The national carrier received an equity infusion of Rs 30,520.21 crore from financial year 2011-12 till date, Puri told the Lok Sabha on December 5.

The major components of the financial package for 2018-19 included a cash support of Rs 3,975 crore to Air India, inclusive of Rs 1,630 crore already infused in the airline in 2018-19.

Another component was for providing a "government guarantee of Rs 7,600 crore, inclusive of Rs 3,000 crore already provided to Air India in 2018-19, to raise new debt for payment of stretched liabilities", he had said.

In April 2012, the then central government had approved a Turnaround Plan (TAP)/ Financial Restructuring Plan (FRP) for reviving Air India, which has been in the red since merger of Indian Airlines in 2007-08.