New Delhi, Jan 16: A Group of Ministers (GoM) is scheduled to hold a crucial meeting tomorrow to critically review Air India's debt recast and turnaround plans and recommend to the Union Cabinet additional equity infusion in the ailing carrier.
The GoM, headed by Finance Minister Pranab Mukherjee, would deliberate on the Reserve Bank of India's views on the debt restructuring plan, as well as the programme for acquisition of 27 Boeing 787 Dreamliner planes, sources said.
This would be the first GoM meeting to be attended by Civil Aviation Minister Ajit Singh, who took over the mantle of the Ministry only a month ago.
The meeting is likely to consider the recommendation by a panel of secretaries to infuse Rs 23,000 crore into the national carrier over the next 10 years, of which Rs 6,600 crore could be invested in the current fiscal ending March 31.
The debt-ridden carrier has outstanding loans and dues worth Rs 67,520 crore, of which Rs 21,200 is working capital loan, Rs 22,000 crore is long-term loan on fleet acquisition, Rs 4,600 is vendor dues and an accumulated loss of Rs 20,320 crore, according to official figures.
The meeting comes less than a week after the Central Board of Excise and Customs froze Air India's 11 bank accounts for non-payment of duties worth an estimated Rs 300 crore.
An Air India official had then said “we are making on account payments and having the accounts released”.
At the last meeting in October last year, the GoM had decided that it could take a decision only after the RBI gave its nod to the debt restructuring plan.
In the past two months, RBI has had several rounds of meeting with Air India's bankers, who also have met the airline's top brass to finalise the debt recast package.
The Minister recently said the GoM may also discuss a proposal to allow foreign airlines pick up stake in the Indian carriers.
“Finally, the Cabinet will take the decision. The Committee of Secretaries has already recommended raising the FDI limits in the sector,” Singh had said last week.
On the acquisition of the B-787 Dreamliners, Air India has already decided to take them on sale and leaseback mode. Two of these planes are expected to be delivered by March.
Under the leaseback model, an airline purchases aircraft from the manufacturer and sells them to a leasing company and then gets the planes back on lease. This erases the aircraft purchase debt from the airline's books.
Two days ago, a US court rejected a plea by American carriers challenging the US Exim Bank's decision to give loan guarantees of USD 1.3 billion to support Air India's fleet acquisition from Boeing.
The Bank has also decided last October to give a USD 2.1 billion preliminary commitment to support future deliveries of Boeing planes to the national carrier, which was legally challenged by the industry body of all major US airlines.
