Air India (AI, Delhi International) has requested approval from the government to borrow INR24 billion rupees (USD346 million) from the National Small Savings Fund to meet the carrier's working capital requirements, the Business Today has reported.
An airline official said that the borrowing, already requested in mid-May but yet to be approved, was necessary since the government has so far failed to transfer a INR24.8 billion (USD357 million) rupee tranche of a bailout package approved by the previous government in 2012. The entire bailout, initially due for disbursement in instalments through the end of 2021, is worth INR302 billion rupees (USD4.4 billion), of which Air India has already received INR270 billion rupees (USD3.9 billion).
A loan from the NSSF, a state-owned fund managing small-scale savings of private individuals, would be much cheaper for Air India than any commercial borrowing.
Air India's total debt stands at INR580 billion rupees (USD8.4 billion).
Meanwhile, the recently re-elected right-wing BJP government of Narendra Modi is preparing to once again try to privatise the carrier. An attempt to sell an up to 76% stake in 2018 failed due to the lack of investors. Pending the decision regarding the renewed privatisation drive, Air India has halted all strategic growth initiatives.
