India’s Ministry of Civil Aviation plans to ask the Indian Government for another INR2,000 crore equity infusion for Air India on top of an already approved INR1,200 (USD450.5 million) to pay off the carrier’s debt (Times of India, 11-Oct-2010). The carrier has an equity base of INR145 crore (USD32.6 million) along with accumulated losses of INR14,000 crore (USD3.1 billion) over the past four fiscals; working capital loan of INR18,000 crore (USD4.1 billion) and aircraft orders of more than INR50,000 crore (USD11.2 billion). Air India requires INR3,000 crore to INR4,000 crore (USD675.8-901.1 million) annually to pay off its debts.
Aviation ministry asks for additional equity infusion for Air India
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Australia-India air travel market grows rapidly but SE Asian hubs hinder nonstop services
The Australia-India market has experienced rapid growth over the last three years, prompting Australia to lobby for more direct services. Visitor arrivals from India are up 50% since mid-2013, and total passenger traffic between the two countries is up approximately 30%.
Air India launched services to Melbourne and Sydney in 2013 but the Australia-India market is still dominated by Southeast Asian flag carriers. Singapore Airlines has been able to maintain a leading 41% share of the market. Malaysia Airlines also still carries more Australia-India passengers than Air India.
Attracting more nonstop flights from Air India, or the possible launch of nonstop flights to India by Australian carriers, will not be easy despite growing demand. Southeast Asia’s network airlines have a competitive advantage as they serve several gateways in both Australia and India. Southeast Asia’s growing medium/long haul LCCs have also started to compete in the Australia-India market and are well positioned to take a large share of the anticipated growth.