Outlay for Air India cut by 40%

The delay in the deliveries of Boeing 787 Dreamliners to Air India [ Images ] has led the finance ministry to cut the targeted Budget plan outlay for the public sector airlines by close to 40 per cent.

However, the investment plan for the Airports Authority of India has increased by around 72 per cent from Rs 1,961.41 crore (Rs 19.61 billion) for the current fiscal to Rs 3,377.10 crore (Rs 33.77 billion) estimated for next year which will fund the modernisation of the Kolkata [ Images ] and Chennai airports among others.

In 2008-09, the National Aviation Company of India Ltd, the government-owned company formed after the merger of Air India and Indian Airlines, was supposed to raise Rs 9,572.42 crore (Rs 95.72 billion) from internal resources and external commercial borrowings.

However, with the deliveries of the Boeing Dreamliners getting delayed for this year Rs 3,785.94 crore (Rs 37.85 billion) was deducted from the investment outlay plan. In 2008-09, the investment plan is now being pegged at Rs 5,786.48 crore (Rs 57.86 billion).

"We were to be delivered a total of five Dreamliners in 2008-09. However, all the deliveries have been deferred till next year. Hence a large amount was deducted from the investment plan," said S Venkat, director, finance, NACIL.

"However, with all these deliveries deferred till 2009-10 and possible fresh orders to come in the estimated investment for next year will have higher numbers," said Kapil Kaul, CEO, Indian subcontinent, Centre for Asia Pacific Aviation.

In case of the Airports Authority of India, the investment has been made primarily for the upgrade of the Chennai and Kolkata airports as well as for the 35 non-metro airports.

"According to the Eleventh Plan, Rs 12,000 crore (Rs 120 billion) is to be spent by the AAI for the upgrade of the airports, which makes an average of Rs 3,000 crore (Rs 30 billion) per year. Hence the investment plan has increased," said KN Shrivastava, joint secretary, ministry of civil aviation.

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