May 11: Air-India has got a $475 million bridge loan from Standard Chartered Bank to fund the acquisition of three Boeing 777 aircraft, a company official said on Tuesday.
“Of the three aircraft, one has already been delivered on Apr 30 and the other two will be delivered in June and July,” he said.
The interest cost of the loan is 375 basis points above the London Interbank offered rate.
Air-India has sought a ‘letter of comfort’ from the government to convert the bridge loan to a long-term loan from the US Exim Bank, the company official added.
The national carrier is estimated to have lost Rs 5,400 crore in the fiscal year 2010 and is expected to remain loss-making for a few more years.
The government had pumped in Rs 800 crore into Air India as equity to help shore up the national carrier’s finances. The state-owned airline would be receiving Rs 1,200 crore in June this fiscal.
The government, however, claimed that the losses of Air India were coming down. “The losses have started declining and with more synergy the situation will improve further,” the civil aviation minister, Mr Praful Patel had told the Lok Sabha recently.
On the criticism regarding mounting losses in the national carrier after merger of Air India and Indian Airlines, the civil aviation minister said, “The merger was planned with a great degree of confidence. Yes, there are some issues which need to be handled carefully and merger is not a one-day process, it is a two or three years process for full integration.” — NW18