DELHI: Documents reviewed by Business Standard show that the Modi administration has been aggressively pumping money in a bid to resuscitate Air India’s fortunes.
From August 2014, a couple of months after the Narendra Modi led National Democratic Alliance (NDA) government assumed power, till March 2017, Rs 16822 crore have been infused into Air India from tax payer’s money, reports Business Standard.
The first tranche of Rs 2000 crore was received by Air India in August 2014. Subsequently, six more payments totaling Rs 1947 crore were made from September 2014 to February 2015.
Between April to November 2015, seven payments amounting to Rs 3300 crore were made. Air India had also requested the government to treat interest reimbursements on its aircraft loans as revenue grants rather than equity support.
This according to the airline would have helped it reduce the interest burden in its balance sheets.
The Modi government’s resolve to revive Air India seemed to have grown stronger the next year. In March 2016, Rs 4318 crore was given to the airline.
These payments were in the form of equity infusions with Air India issuing over 4 billion shares to the government and were part of the national airline’s Turnaround Plan (TAP) and Financial Restructuring Plan (FRP).
In March 2017, another Rs 5257 crore was given to Air India in the form of equity infusions.
Being a government owned company; over 5 billion shares were allotted to the President of India as part of the deal. While these figures look impressive, Air India has been surviving on such infusions for a long time now.
In 2013-14, the erstwhile Manmohan Singh led United Progressive Alliance (UPA) government had pumped Rs 6000 crore into the airline in a similar manner. This was Rs 1000 crore more than the approved amount.