Air India Ltd plunged to a record net loss underscoring an intensely competitive domestic aviation market and adding strength to calls for privatizing the national carrier.
The New Delhi-based carrier posted a provisional net loss of ₹8,556.35 crore in 2018-19, civil aviation minister Hardeep Singh Puri told the Lok Sabha on Thursday. It had a net loss of ₹5,348.18 crore in the previous year.
Accumulated losses at Air India have swelled to about 69,575.64 crore in the past decade, Puri said.
Air India, which is surviving on a taxpayer bailout, has never seen a profit since its merger with Indian Airlines in 2007-08.
Last week, Puri informed the Rajya Sabha that the airline might have to shut down if the government’s second attempt to privatize it fails.
“It is not feasible for the government to continue to operate a loss-making airline like Air India by infusing taxpayers’ money into it even as the carrier’s accumulated losses grow bigger with every passing year," a New Delhi-based aviation consultant said, requesting anonymity. “As things stand, it seems that this airline can never make money under government control. The only options are to privatize the airline or shut shop."
Air India flies to at least 43 cities in 31 countries, besides 55 cities within India. It is currently the only Indian airline to operate long-haul flights.
The airline currently has liabilities of nearly ₹22,000 crore, including about ₹5,000 crore outstanding to oil refiners, about ₹5,000 crore to private and state-run airport operators and about ₹8,000 crore contingent liabilities from advance booking of tickets. The airline also owes its various other vendors close to ₹4,000 crore. On top of these liabilities, it owes debt of about ₹58,000 crore, including working capital and aircraft debt.
To reduce the debt burden on Air India, the government has transferred around ₹29,464 crore to Air India Assets Holding Ltd, a special purpose vehicle meant to park some of the airline’s debt not backed by any asset, non-core assets and other non-operational assets.