The civil aviation ministry’s plan to get Air India off the ground has received criticism from an unexpected source. Mint has learnt that home minister P Chidambaram questioned the revamping plan during a group of ministers meeting in November. At that time, the group of ministers had decided to infuse Rs2,000 crore of capital into Air India over several months, even though Chidambaram wanted the airline to come up with a proper plan to get its balance sheet in order. Air India is demanding Rs5,000 crore in equity to cope with losses and to pay off loans.
In banking, Punjab National Bank or PNB has seen only a marginal increase in third quarter numbers. Its net profit reached Rs1,011 crore, an increase of just 0.5%. And treasury income fell dramatically to Rs157 crore compared to Rs341 crore in the same period last year. PNB is not alone in registering low third quarter growth. State Bank of India also announced only marginal growth in the period. And ICICI Bank saw its profits fall because of higher bond yields and bad loans.
Also in results on Wednesday, London-based mining company Vedanta has posted a major rise in its third quarter earnings. Its EBITDA went up to $662.5 million in the three months ending in December, compared to just over $10 million for the same quarter a year ago. Vedanta is India’s biggest copper producer and its numbers have been helped by a jump in prices of the metal.
Infrastructure Development Finance Corporation or IDFC also announced its third quarter numbers. Net profit rose 46% to Rs270 crore for the quarter.
In other new, India’s economy might not be growing as much as the government thinks it is. A new survey of economists by industry body Ficci has estimated GDP growth in the current fiscal will only be 6.9%. The government has projected a growth of 7.75%. The main reason for the expected low performance is India’s agricultural sector, which the survey predicts will contract by 1%.