New Delhi: Finance Minister Arun Jaitley Saturday proposed infusion of an additional equity of Rs.2,500 crore in the cash-strapped national passenger carrier Air India for 2015-16 fiscal.
According to the expenditure budget document, a budgetary support of Rs.2,500 crore has been earmarked for equity infusion in Air India.
“The provision under (investment in public sector undertakings) this head is
made for government investment in the PSUs under ministry of civil aviation. The instant provision is for equity infusion in Air India,” said notes on demands for grants, 2015-2016.
Last financial year Rs.6,500 crore was infused in Air India. The national passenger carrier, which has an accumulated debt of around Rs.40,000 crore was given Rs.6,000 crore as budgetary support in 2013-14.
The budgetary support is a part of a turnaround and a financial restructuring plan worth Rs.30,000 which was passed in April, 2012.
The turnaround plan worth Rs.30,000 crore of equity infusion is expected to be completed over a period of nine-years starting 2012-13.
Apart from Rs.30,000 crore of equity infusion, the turnaround plan envisions Air India getting Rs.7,400 crore by issuing government-backed non-convertible debentures (NCDs) to its lenders, like financial institutions, banks, LIC and EPFO.
