Air India to get Rs 5k cr equity
Finance Minister P. Chidambaram Thursday proposed to pump in Rs.5,000 crore ($909.09 million) into ailing national carrier Air India in the next fiscal.
"Budgetary support of Rs.5,000 crore has been earmarked for equity infusion in Air India Limited," said the expenditure budget presented to the Lok Sabha for the financial year starting April 1, 2013.
In his last budget (2012-13), then finance minister Pranab Mukherjee had allocated Rs.4,000 crore for the flag carrier.
The flag carrier has received substantial support from the government to revive itself under the turnaround and financial restructuring plan which were approved by the union cabinet last year.
Under the turnaround and financial restructuring plans includes equity for cash deficit support of Rs.4,552 crore till fiscal 2021, equity for already guaranteed aircraft loan of Rs.18,929 crore till fiscal 2021.
The national carrier is expected to start generating profits from normal operations by the end of the current fiscal March 31, according to the Economic Survey 2012-13 tabled in the parliament Wednesday.
The survey said that the airline has been able to achieve targets set in the turnaround plan and is expected to become EBIDTA (earnings before income, taxes, depreciation and amoritisation) positive.
Meanwhile, other government aviation bodies such as the Airports Authority of India (AAI) has been allocated Rs.42 crore, out of which Rs.32 crore has been earmarked for its project at Pakyong airport, Sikkim.
The aviation regulator, the Directorate General of Civil Aviation (DGCA), has been allocated Rs.30 crore to pursue its plan schemes.
In last year's budget AAI had been allocated Rs.280 crore, out of which Rs.80.52 crore has been earmarked for airport development in the northeastern states. While, DGCA had been provided Rs.60 crore.
Other provisions in the budget include Rs.10 crore for the Bureau of Civil Aviation, while Rs.5 crore has been provided to Hotel Corporation of India for renovation of its hotels and flight kitchen.
Aero Club of India has been provided grants-in-aid of Rs.eight crore.