Air India's demand for equity infusion finds favour with PM

New Delhi, Aug 8 (PTI) Cash-strapped Air India's demand
for equity infusion Saturday received support from India's
Prime Minister Manmohan Singh, who also lent a "sympathetic"
ear to the problems faced by the Indian aviation industry.

India's Civil Aviation Minister Praful Patel met Singh
and briefed him about the problems of the airline industry
which has been protesting the high rates of sales tax imposed
by various state governments on aviation turbine fuel (ATF)
and seeking lowering of airport charges.

Patel also briefed Singh on the proposal to set up a new
Advisory Board for Air India, which is expected to comprise
eminent personalities and professionals to guide the national
carrier out of its financial trouble.

While an "early decision" on the new Board was expected,
an official spokesperson said the Prime Minister was also
"supportive" of the airline's demand for equity infusion.

The airline currently has an equity base of only Rs 145
crore and has placed orders for 111 aircraft worth Rs 50,000
crore. Sources said the government could consider infusing an
additional equity of Rs 9,500 crore.

At the meeting of the Union Cabinet next Thursday, Patel
is expected to make a detailed presentation on the concerns of
the civil aviation sector, the sources said.

They said the Civil Aviation Ministry is likely to
suggest the setting up of a Group of Ministers to resolve the
problems faced by the aviation industry, especially on account
of high taxes on jet fuel, in a time-bound manner. PTI ARC
ANU
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