Air India's debt balloons to 152 billion rupees

Singapore
Source:
This story is sourced from Pro
See more Pro news »

National carrier Air India's debt swelled to 152.41 billion Indian rupees ($3.2 billion) in June after paying for new planes from Boeing and Airbus.

This is more than double its debt of 65.5 billion Indian rupees in November 2007, said Indian civil aviation minister Praful Patel in a statement to India's parliament.

"The airline has been facing a financial crunch for the past few years," Patel told parliament in the statement.

He added high oil prices and the recession have compounded the airline's operating losses.

The week commencing 29 June, the Indian government agreed to bail out national carrier Air India.

In late June, Air India also avoided a strike by agreeing to bring forward a wage payment to 3 July from 15 July.

On 16 June an Air India spokesman told ATI the company would delay $70 million in pay for two weeks to 15 July from 1 July, citing a challenging economic environment. The move would have affected 31,500 employees.

A threatened strike on 1 July, however, apparently caused Air India management to bring the delayed wages forward to 3 July.