Indian Government considering USD1.1 billion phased equity injection into Air India
India's Minister for Civil Aviation (MoCA), Praful Patel, reportedly stated the Indian Government is considering plans for a USD1.1 billion phased equity infusion for Air India (The Economic Times, 14-Oct-2009). Minister Patel stated Air India would be required to reduce costs by USD652 million and raise revenue of USD435 million, to address mounting losses. The MoCA reviewed (14-Oct-2009) the functioning of Air India at a meeting with employees of various sections of the carrier. The Committee of Secretaries (CoS) is looking into the entire process of the turnaround plan, which is conditional upon cost cutting and revenue enhancement. The Committee will meet today (15-Oct-2009) to discuss various options for the carrier. [more]
Ministry of Civil Aviation: "The aviation industry is on the road of recovery, though not as quickly as forecast before. Losses just due to high oil prices have been around INR10,000 crores (USD2 billion) in the Indian Aviation sector alone. This is been further compounded by the economic slowdown, 26/11 terrorist attacks and various cost cutting measures by both the corporate and the government sector. The sector has seen 30% drop in air traffic though there has been slight improvement in last two to three months, however there is still a long way to go," Ministry of Civil Aviation statement, 14-Oct-2009.