Air India may submit new turn-around plan to govt

MUMBAI: The board of the embattled flag carrier Air India today met here and reportedly decided to submit a revised turn-around plan to the government.

Though airline spokesperson described the meeting as "routine", a source said, "The board decided to submit a revised turn-around plan to the government following the finance minister's recent call to cut down on expenses. It also discussed the funding plan for the proposed acquisition of 27 Boeing 787 Dreamliners."

The national carrier, which is sinking in a pit of Rs 63,000-crore debt and has not been paying its employees for months now, has been demanding an emergency Rs 3,000 crore capital infusion from the government.

But the group of ministers, which is looking into the problems plaguing the flag carrier and the turn-around plan, is yet to take a call on the fund infusion. The GOM is also not convinced of the feasibility of the SBI Caps-Deolitte-prepared turn-around plan.

Air India has a debt of Rs 42,000 crore incurred by way of its 2007 plan to acquire over 110 planes from Boeing and Airbus, besides a working capital loan of over Rs 21,000 crore. The working capital loan was mostly extended by a consortium of state-run banks like SBI, PNB, IDBI Bank, and Syndicate Bank among others.

Over the past four fiscals, the airline accumulated Rs 14,000 crore losses and is likely to report a loss of Rs 7,000 crore in FY11.