The government on February 28 announced Rs 5,000 crore additional equity infusion for debt-ridden national carrier Air India in the next fiscal as part of its turn around plan. Rs 5,000 crore (has been marked) for equity infusion in National Aviation Company of India (now Air India), according to Budget documents.
Air India will also be able to generate Rs 1,318.60 crore through internal and extra budgetary resources (IEBR) in 2013-14, it said. In April, 2012, the government had approved a turn around plan and a financial restructuring plan for improving the operational and financial performance of Air India as its losses had increased considerably to Rs 7,853 crore in 2011-12 from the levels of Rs 5,548.26 crore in 2008-09.
The turn-around plan included Rs 30,000 crore equity infusion over a nine-year period starting 2012-13. Accordingly, Rs 4,000 crore was earmarked for Air India in this fiscal's Budget, which was later increased to Rs 6,000 crore in the revised estimates.
In 2011-12, the airline was given a Budgetary support of Rs 1,200 crore, so that it can improve its financials and performance. The Union Civil Aviation Minister Ajit Singh said that the national carrier has turned EBITDA (Earnings Before Interest, Depreciation, Tax and Amortization) positive to the tune of Rs 48.75 crore between April and December 2012.
In the first nine months of the current fiscal, Air India has earned an operating revenue of Rs 11,400.44 crore while its operating expenses were Rs 13,954.47 crore, resulting in an operating loss of Rs 2,554.02 crore, Singh had said.