Banks, aircraft lessors serve default notices on debt-laden Air India

Govt yet to commit financial support after failed divestment process

Air India has started defaulting on government-guaranteed loans to lenders and aircraft lessors, setting off alarm bells over the national carrier’s state of finances and credit-worthiness. This is adding to the stress of the airline as it has failed to earn enough profit to cover the interest payment on its Rs 466.69 billion debt.

The situation has turned even more precarious as the government, the owner of Air India, remains non-committal on infusing cash into the company after a failed privatisation process recently. Of the Rs 18 billion committed to Air India in 2017-18, only Rs 6.5 billion has been