Also, RBI likely to okay its debt restructuring plan next month.
National Aviation Company of India Ltd (Nacil), the state-owned unit that runs Air India, should soon get its much-awaited Rs 1,200 equity infusion from the Union government, said civil aviation minister Praful Patel.
He said he was confident the Cabinet Committee on Economic Affairs (CCEA) would clear it in November. “CCEA will review the progress of Air India and give the budgeted amount,” said Patel. The minister was, however, silent on whether the airline has achieved the milestones CCEA had earlier specified as a precondition.
The government had infused Rs 800 crore into Nacil last financial year to help the airline reduce its losses and mounting debt.
AI is also hopeful that the Reserve Bank of India (RBI) would approve its debt restructuring plan by November, Patel said, after a review of the company’s finances here today. “SBI Caps has sent a proposal to the banking regulator. We see no reason for RBI to reject the proposal, as the regulator has in-principle agreed the the aviation sector needs support,” he said, noting the central bank had already approved similar plans for privately-owned Kingfisher Airlines.
Nacil’s current debt is around Rs 19,000 crore and it has taken several measures to improve its finances and operations. “At this stage, things are looking better. However, problems are not behind us,” Patel said, while giving out the company’s achievements in the first half of this financial year.
In this period, the carrier has seen an increase of 16 per cent in daily passenger traffic. Presently, an average of 35,500 passengers takes AI flights each day, compared to 30,500 travellers a day last year. There is a 13 per cent increase in yield per passenger over the past two quarters.
Though Patel did not disclose Nacil’s present revenue, he said it was up 22 per cent in the first half. This translates to an increase of Rs 5 crore revenue a day, he said.
AI has also managed to bring down its cash loss on international operations to Rs 500 crore from 1,100 crore earlier. On domestic operations, it has cash profits of Rs 87 crore, compared to a cash loss of 470 crore earlier.
It is also phasing out older aircraft such as the A320s and A310s, to get a younger fleet. “New aircraft means better fuel efficiency and lower fuel bills,” Patel said. Adding, “Though the performance has improved on some parameters, there are still areas that need a drastic change.”