Meltdown forces AI to defer salary

Air India’s losses for the last financial year are estimated at around Rs 4,000 crore, up from Rs 2,226 crore in the previous fiscal.

Reports say the national carrier was planning to seek Rs 5,000 crore as additional equity, Rs 7,000 crore as a soft loan payable after five years at a five per cent interest rate, and a grant of Rs 2,000 crore. However, top Air India officials have denied the figures, but said they are working on similar lines.

Maintaining that the financial crisis was foreseen last year, industry sources said the acute situation could have been avoided had Air India delayed the ongoing deliveries of aircraft, like its competitors Jet Airways and Kingfisher Airlines did.

They said there is no capacity since air traffic had gone down substantially due to the financial meltdown, and so the induction of additional aircraft could have waited. Air India has placed orders for 111 new planes worth over Rs 45,000 crore and it currently has a paid-up capital of Rs 145 crore and authorised capital of Rs 1,500 crore.