India's civil aviation minister Vayalar Ravi stated a group of ministers on civil aviation has "on principle" approved to pay Air India INR5.3 billion (USD119 million) in dues out of around INR12.2 billion (USD274 million) it owes to the carrier (Telegraph India/IANS/TNN/Economic Times/Reuters/PTI/Business Standard/Economic Times/Hindu Business Line, 18-Jul-2011). The panel also decided to infuse equity into the carrier but stated it would again meet next week to "take a final decision on the matter of more equity infusion", Mr Ravi said. According to Mr Ravi, a consensus had been reached to expedite the equity infusion and to implement the revival plan for the carrier. The panel is expected to decide on Air India’s turnaround and financial restructuring plans, prepared by the State Bank of India’s financial advisory arm SBI Caps, at its next meeting. The date for the next GoM meeting was not disclosed. Air India had expected the government to pay INR8 billion (USD179 million) as part of the dues on account of VVIP and evacuation flights. The carrier, which has debts of around INR400 billion (USD9.0 billion) it has incurred due to aircraft acquisition and loan costs, has requested a fresh equity infusion of INR12 billion (USD269 million) and the dues of around INR5.3 billion for operating the VVIP flights. The carrier is also seeking a total infusion of INR170 billion (USD3.8 billion) including INR50 billion (USD1.1 billion) in the current fiscal year. The airline is also in talks with banks to restructure its loans and reduce its interest expenses. Mr Ravi stated a consensus has been reached on expediting equity infusion and implementing the revival plan. Prime Minister Manmohan Singh has requested the GoM to come to a quick conclusion on the matter. "I will request (Finance Minister) Pranab Mukherjee to take expeditious decisions in the (Air India turnaround) matter," he has said.
Panel on Air India provide in-principle approval for cash infusion
You may also be interested in the following articles...
CAPA India Aviation Outlook 2017/18: Surging traffic but infrastructure constraints become critical
India’s status as the fastest growing aviation market in the world creates tremendous opportunities. But risks are also heightened as the inadequacy of India’s infrastructure planning, a fast emerging shortage of skills, flawed policy initiatives, and weak regulatory oversight threaten to become major stumbling blocks. The potential is enormous; but unless government bites the bullet, it will be seriously constrained.
This report is a short extract from CAPA's comprehensive 200-page India Aviation Outlook Report FY2017/18, to be released in Feb-2017 at the CAPA India Aviation Summit. The Outlook includes CAPA's projections for traffic, capacity, yields and earnings and presents fleet induction plans, detailed operating and financial analysis and risk assessments of each Indian airline and airport operator. The report also includes analysis of policy and regulatory issues.
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.