Cabinet to take up AI expansion plan after RBI report

Air India's acquisition plan for 27 Boeing 787 Dreamliner planes and for additional equity infusion of Rs 6,600 crore would be deliberated by the Union Cabinet after the Reserve Bank of India (RBI) gives its views on debt restructuring plan for the ailing national carrier.

"A report on [Air India's] debt restructuring prepared by the Committee of Officers will be reviewed by the RBI within a week. Only after that will any decision be taken," Civil Aviation Minister Vayalar Ravi told reporters after a meeting of a Group of Ministers (GoM) here today.

The credit line by oil companies to the cash-strapped national carrier for purchase of jet fuel would be extended by three more months, officials present in the meeting said.

Oil firms had earlier given a two-month credit line to the airline which was till then buying fuel by making daily payments.

Ravi said once the RBI reviews the report on financial restructuring the issues of equity infusion and acquisition of Dreamliners would be tabled before the Cabinet.

After the RBI submits its comments on the report, "we will have a quick meeting and decide on the next course", the officials said.

Besides Ravi, the two-hour meeting of the GoM, headed by Finance Minister Pranab Mukherjee, was attended by Union Ministers P Chidambaram and S Jaipal Reddy, Planning Commission Deputy Chairman Montek Singh Ahluwalia and Civil Aviation Secretary Nasim Zaidi among others.

The Civil Aviation Ministry has already moved a proposal for additional equity infusion of Rs 6,600 crore for the ailing carrier to enable the airline clear its massive dues. The government has already infused equity worth Rs 2,000 crore in the last two years.