Air India to borrow Rs 500 crore for meeting working capital requirement

Debt-ridden Air India has today invited bids from Indian as well as foreign banks and financial institutions for a short-term loan of Rs 500 crore. The amount will be utilised for meeting working capital requirements.

"Air India invites bids from Indian / Foreign Banks and Financial Institutions for a Government Guaranteed loan of INR 500 crores,” said Air India on its website.

With this Rs 500 crore new loan, the state-run airline will exhaust its Rs 2,000 crore guarantee given to it by the government. The beleaguered airline has already taken a loan of Rs 1,500 crore from Bank of Baroda to regularise some of its accounts to save them from turning into NPA. 

Meanwhile, the parliamentary standing committee on transport, tourism and culture, has suggested that government should give Air India five more years to revive itself by writing-off its massive debts.

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Earlier, on September 4, Ministry of Civil Aviation Secretary RN Chaubey has said that the government has assured Air India of Rs 2100 crore in the form of guaranteed borrowing. 

As per reports, the airline is currently under a debt of around Rs 500 billion and has reported a loss of Rs 57.6 billion in March last year.