Air India to receive additional equity infusion of Rs1,200 crore

Berlin: Flag carrier Air India will receive additional equity to the tune of Rs1,200 crore over the coming months from the government, according to civil aviation minister Praful Patel. It will also have its performance reviewed in an attempt to chart out the future course of action, he added.

Patel also clarified there was no move to divest government equity in the cash-strapped national carrier "at the moment".

"It is imperative that we assess the situation after Rs2,000 crore is infused as equity. Rs1,200 crore will be given in the next few months," Patel said in an interview on the sidelines of the annual summit of the International Air Transport Association (IATA) here.

The carrier has already received Rs800 crore as equity from the government last year.

Asked if the government was looking to divest its stake in the ailing carrier, he said "at the moment, the decision is not to disinvest and we stand by the policy of the government. Government's decision is to have a national carrier and it shall continue to be so."

On the issue of a "course correction" with respect to the merger of Air India and erstwhile Indian Airlines following criticism from several quarters, Patel said "no, nothing of the sort. We have to make sure that it works well. We have to see how it performs (after the equity infusion). There has been no government subsidy to Air India".