In an attempt to stave off criticism after the national carrier made news for having its oil supply cut-off, chairman and managing director of Air India Ashwani Lohani on Sunday said that the airline cannot be expected to repay its debt on its own.
“It is a fact that huge debt servicing affects every single aspect of the working of the airline... Expecting it to service out of its revenues is indicative of a lack of appreciation of the working of the airlines,” Mr. Lohani wrote on his Facebook page. He added that the airline’s inability to pay oil companies did not in any way reflect its operational performance.
Air India has a total debt of ₹58,351 crore as on March 31 this year. The government had created a special purpose vehicle to which a sum ₹29,464 crore, or half of Air India’s total debt, was transferred to enable it to save on interest payments of ₹4,500 crore annually.On Thursday, oil companies cut-off aviation fuel supply to the airlines at six stations. Officials say it owes ₹3,000- ₹4,000 crore to oil companies alone.