Saddled with a debt of almost Rs 50,000 crore, Air India is likely to get another loan of up to Rs 6,000 crore to meet expenses before it is sold off.
The national carrier was due to get Rs 2,500 crore this fiscal, according to the equity infusion plan and is facing a shortfall of Rs 700 crore.
According to Economics Times, the government has taken measures so that it does not run out of cash.
“We have obtained government guarantee to enable Air India to borrow up to Rs 6,000 crore for meeting cash deficit in the runup to disinvestment,” aviation secretary R N Choubey told TOI.
“We were facing a shortfall of Rs 700 crore in equity infusion this fiscal. However, now we have arranged for loan and are okay for the next few months,“ said a senior AI official.
The government has started the process of appointing transaction advisers and valuators for AI. The Department of Investment and Public Asset Management (DIPAM) will manage this process.
Earlier this month, Air India had planned to take short-term loans of up to Rs 3,250 crore to meet “urgent working capital requirements”.
As part of efforts to revive the loss-making Air India, a ministerial panel is working on the modalities for strategic disinvestment of the carrier and its five subsidiaries.
Under a turnaround plan approved by the previous UPA regime, Air India is to receive up to Rs 30,231 crore from the government subject to meeting certain performance thresholds. The 10-year bailout package began in 2012.