Govt may pay Air India Rs 802 cr in dues

With the decision on infusing Rs 1,200 crore as equity in Air India expected soon, Indian government may consider giving the airline a little over Rs 800 crore additionally as dues for operating flights for VVIP and evacuation operations carried out by it, sources said on Tuesday.

Though Air India has billed an amount of Rs 1,222 crore for dedicating five Boeing 747-400 planes for VVIP operations, the government could give the ailing airline Rs 802 crore for the operation of three aircraft, they said.

The issue is understood to have come up for discussion at a meeting here of a Committee of Secretaries (CoS) headed by Cabinet Secretary AK Seth.

The CoS is also understood to have asked the national carrier to finalise its Turnaround and Financial Restructuring Plans and present it to the Indian Civil Aviation Ministry in the next couple of days, so that the Group of Ministers (GoM) led by Indian Finance Minister Pranab Mukherjee can take it up next week.

After ratification of these plans by the GoM, a proposal to infuse Rs 1,200 crore is likely to be placed before the Cabinet Committee on Economic Affairs for approval.

The meeting of the CoS, which also has Secretaries of Economic Affairs, Expenditure, Financial Services and Planning Commission representatives as members, was also attended by Civil Aviation Secretary Nasim Zaidi and AI CMD Arvind Jadhav.

Indian Prime Minister Manmohan Singh recently told a select group of editors that he would request Mukherjee to expedite measures to strengthen the national carrier.

The government is now considering exclusively using four Embraers and two Boeing Business Jets, maintained by the Indian Air Force, for VVIP operations depending on the range of flights and the size of delegations.