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No money to pay salaries: Air India to Manmohan

Published on 10 Jul. 2011 2:15 AM IST
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National carrier Air India has sent an SOS to the Prime Minister. CNN-IBN has accessed Air India’s presentation to the Prime Minister, saying, “Please give money or else operations will stop.” Air India has also said that banks have stopped lending as the airlines have defaulted on interest payments. “Banks want government guarantee before further lending to Air India,” the carrier has said. Air India’s vendors haven’t been paid for over three months and they said that they will not supply anymore until they are paid in cash. Airline sources said that this could bring the airline to a halt. “No interest has been paid on loans since April and total over dues are put at Rs 4500 crore,” Air India has said. Air India earns Rs 1100 crore each month, but it spends Rs 1700 crore largely in buying fuel and so, little is left to repay loans. The airline is paying an interest of Rs 2500 crores yearly for loans to run their daily operations. Air India has borrowed an additional Rs 22,000 crore to buy new aircraft. The interest on this alone amounts to 1000 crore every year. Air India has also asked the government to pay up Rs 1,173 crore dues for VVIP operations to pay staff salaries. The government now needs to move fast to keep the Maharaja’s ventilator support switched on.

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