New Delhi: Government on Wednesday allayed apprehensions that the already strained finances of Air India might see further pressure following reduced allocation of funds for the carrier in the next fiscal budget and said it is committed to infuse more equity based on the requirement.
Finance Minister Arun Jaitley in his 2016-17 Budget speech on Monday had said national carrier Air India will get Rs 1,713 crore funding from the Government for FY17, against a demand of Rs 4,300 crore.
"There is not any cause of worry. The immediate requirement of Air India has been fully factored in the
budget. Any additional requirement will be placed in the supplementary budgets," Civil Aviation Secretary R N Choubey said.
Choubey said that in the current fiscal also, funds have been infused in phased manner with the bulk of equity allocated in the main budget and additional requirements met through the supplementary demands.
The then UPA government had approved Air India's turnaround plan in April 2012, with a committed public funding of Rs 30,231 crore, staggered over a period of nine years, with some specific riders.
Air India was allocated Rs 2,500 crore in the Union Budget for 2015-16 as against a demand of Rs 4,300 crore. To make up the shortfall, the Ministry had sought Rs 1,800 crore through supplementary demand for grants.
The government-run carrier has till date received Rs 22,280 crore as part of the bailout package.
He said payment of salaries at Air India will not be impacted as "at any point of time we (civil aviation ministry) can go to Finance Ministry to seek additional funding." Choubey said in the current fiscal the funds have come less through the budget and more by way of supplementary, adding this year it will be the other way round.
The Government has pegged Air India's losses at Rs 3529.80 crore for this fiscal, down from a net loss of Rs 5,859.91 crore in FY 15.
However, its debt burden stood at Rs 51,367.07 crore in the financial year ended March 2015. \
Published Date: Mar 02, 2016 17:56 PM | Updated Date: Mar 02, 2016 18:00 PM