National carrier Air India will get Rs 2,100 crore from the government in the form of guaranteed borrowing, news agency ANI cited Civil Aviation Secretary RN Chaubey as saying on Tuesday. A guaranteed loan is a secured loan in which a party other than the borrower is responsible in case the borrower defaults. State-run Air India has accumulated losses to the tune of Rs 46,805 crore. The government had in June this year shelved a plan to sell its 76 per cent stake in the debt-laden airline after it failed to attract interest from bidders. The carrier has been kept afloat for years using taxpayer funds.
The government has considered capital infusion into the airline. To fund the capital infusion in Air India and other sectors, the government has sought Parliament's approval for an additional net spending of Rs. 5,951 crore, on top of the budgeted Rs. 24.42 lakh crore for 2018/19.
In July, Mr Chaubey had said that the government had yet not given up on the disinvestment plan, however, the same would be taken up once the conditions become favourable.
Air India, which employs some 27,000 staff, said this month it was seeking a short-term loan of Rs. 1,000 crore ($148 million) so it can continue day-to-day operations.
The carrier had debt worth Rs. 49,100 crore ($7.16 billion) as of March 31, 2017.