Air India needs Rs 4,500 crore bailout: Patel

Air India would need a bailout package of around Rs 4,500 crore to bring the national carrier out of financial crisis,civil aviation minister Praful Patel said here today.

The government needs to put in around Rs 2,500 crore of equity,which can be repaid in future once partial disinvestment takes place. You can look at another couple of thousand crore by way of soft loans,which is again repayable, Patel told a news channel.

On the proposition of eminent personalities such as Ratan Tata,N R Narayan Murthy and Sam Pitroda joining the Air India board of directors,he said,Why not? Ultimately if such people are willing to contribute for a public cause,for bringing the national carrier back on track,I think it is a great thing. Explaining their role,Patel said they would be independent directors.

He said that the government was still talking to some eminent personalities and would come out with the names of those who would be part of the Air India board once it is finalised. Some of them have said yes but until I formalise the whole thing,I would not like to disclose their names, the minister said.

Hectic activity is on at the national carriers headquarters for preparing a comprehensive financial restructuring plan,which is to be submitted to the government in the next few weeks. AIs losses mounted to about Rs 5,000 crore in 2008-09. The plan would be vetted by a high-level committee headed by Cabinet secretary K M Chandrasekhar,which would be monitoring each month the steps taken by the airline to cut cost and enhance revenue generation.

As part of the restructuring strategy,a separate plan is being prepared for the return of Air Indias leased aircraft at the earliest. A team has been set up to work on the lease contracts,the sources said. This is apart from the ongoing review of its fleet acquisition plan which is likely to be redrawn,they said. Air India has till date inducted 49 planes out of its order for 111 aircraft at an estimated cost of Rs 10,000 crore.

As part of its plans,Air India will close its offices at overseas locations where it does not operate. Heads of strategic units concerning cargo,MRO and other businesses are also finalising similar plans.

TOP GUNS TO SIT ON BOARD

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NEW DELHI: Air India is in the process of having a seven-member international advisory board,with former top officials of global carriers,to turn the organisation around. The board,which is likely to be headed by industrialist Ratan Tata,may have former heads of leading carriers like Lufthansa and Singapore Airlines,sources in the know said. Discussions are on to finalise the names of other members on this global advisory board,sources said,adding that an advertisement would soon be issued for the newly-created post of chief operating officer so that a professional airline manager works under chairman-cum-managing director Arvind Jadhav to improve AIs operations. PTI