Air India pays Rs 1 bn to OMCs towards partly clearing pending dues

The oil marketing companies asked debt-laden Air India to clear its dues towards daily billing amid rising oil prices

Air India on Monday paid Rs 1 billion to state-owned oil marketing companies to partly clear dues related to purchase of jet fuel, a senior official said.

In September, the companies asked debt-laden Air India to clear its dues towards daily billing amid rising oil prices.

The national carrier lifts jet fuel from three oil marketing firms -- Indian Oil Corp, Bharat Petroleum Ltd and Hindustan Petroleum Ltd -- worth Rs 6 billion per month on an average.

A senior Air India official said such notices are "not unusual" and that the airline paid Rs 1 billion on Monday to the oil marketing companies.

According to an Indian Oil Corp official, a notice has been sent to Air India asking it to clear the dues.

Air India group, which comprises Air India, Air India Express and Alliance Air, operates 475 flights per day to 78 domestic and 44 international destinations.

It is the only domestic carrier which flies long and ultra-long haul flights or flights which are up to 16 hours duration.

The airline, whose debt is more than Rs 500 billion, is grappling with financial woes and the government is working on ways to bolster the carrier's fortunes.

In May, efforts for strategic disinvestment of Air India failed to take off.