Mumbai: Civil Aviation Minister Ashok Gajapathi Raju on Tuesday said Air India’s books are “bad”, and “business as usual” is not going to help it, but the Government wants the airline to survive. AI is grappling with “legacy” issues, he added.
The minister’s remarks came against the backdrop of Air India Chairman and Managing Director Ashwani Lohani stating in a Facebook post earlier this week that the massive debt on Air India’s books is the root-cause of all its woes. Lohani termed the over Rs48,000 crore debt as “insurmountable” and blamed the policies of the erstwhile UPA government for its precarious finances.
“Air India is a lovely airline. It has all legacy issues. Its finances are very bad...The books are so bad that the business as usual is not going to help it,” Raju told reporters here, after inaugurating Integrated Operational Office Complex building of the AAI, DGCA and the BCAS. “It is a nice airline, and I would like it to survive,” he said, adding that he is “open” to suggestions from any quarters for the airline’s turnaround. “Of course there are people who praise it, there are people who bash it. I am not one of the bashers.
But I am also not a blind praiser,” he added. Air India, which is surviving on a Rs30,000 crore bail-out package spread over 10 years announced by the Manmohan Singh government in 2012, is working on ways to improve its financial position. In the 2015-16, the airline posted operational profit of Rs105 crore on account of low fuel prices and increased passenger numbers.
Currently, its debt is estimated to be a little over 48,000 crore, with nearly a third of borrowings on account of the aircraft acquisition. A consortium of 19 lenders have extended loans to the national carrier. It is looking to re-jig debt of Rs10,000 crore under the scheme for sustainable restructuring of bad assets floated by the Reserve Bank.