ALSO READCabinet to take a call on debt-laden Air India's revival, says Jayant Sinha Air India's fleet expansion on hold after NITI's privatisation proposal Cabinet nod for disinvestment: Air India stake sale takes off Air India sale: Govt to process NITI Aayog report on it, says Arun Jaitley Air India to post operating profit of Rs 300 crore this financial year
"NITI Aayog in its report on Air India says that further support to an unviable non-priority company in a matured and competitive aviation sector would not be the best use of scarce financial resources of the government," he said.
The minister of state for civil aviation was responding to a query on the main reasons behind the proposed disinvestment of Air India.
"Air India has been incurring continuous losses and has huge accumulated losses," he said.
NITI Aayog submitted its recommendations (fourth tranche) on strategic disinvestment of the central public sector enterprises on May 12.
The airline's total debt stood at Rs 48,876.81 crore at the end of March 2017.
Out of the total amount, Rs 17,359.77 crore are aircraft loans while Rs 31,517.04 crore are working capital loans.
"The rates of interest on aircraft/ working capital loans are linked to the respective bank's prime lending rates/base rate/libor plus margins prevalent at the time when these loans are taken," Sinha said.
"Out of the 23 B-787 aircraft, 21 B-787 Dreamliner aircraft have been acquired under the Sale and Lease Back (SLB) arrangement and the remaining 2 aircraft have been procured under bridge loans till their SLB financing is finalised.