Cash-strapped Air India on Thursday got a boost with the Reserve Bank of India approving extension of its loan tenures from 10 to 15 years. “Yes, the RBI has cleared our loan restructuring proposal on Thursday,” an Air India official told PTI in Mumbai. He said the RBI had approved the extension of the loan tenures to 15 years from 10 years.
The decision, which would considerably ease the debt servicing burden of the troubled airline, was taken at a meeting that was attended by officials of the RBI, Air India and SBI Caps, which had submitted the debt restructuring proposal.
When contacted, RBI spokesperson confirmed the meeting but refused to elaborate any further.
Under the Rs.18,000-crore Corporate Debt Restructuring (CDR) proposal, the lenders would extend the tenure of Rs.11,000 crore short-term loans into long-term loans of 15 years and convert Rs.7,000 crore debt into equity.
In Delhi, official sources said discussions with the RBI were being carried out on various issues, including on Air India's balance sheet, financial position and future projects. The beleaguered national carrier has accumulated debt of over Rs.64,000 crore from 14 lenders which, under the aegis of SBI Caps, had submitted a restructuring proposal to the RBI seeking its permission to extend the loan tenures, among other issues.
Out of this, over Rs.22,000 crore are accumulated losses, while Rs.40,000 crore amounted to loans taken for aircraft acquisition.
A Group of Ministers (GoM) had recently asked the AI to get the debt recast proposal cleared by the RBI within this month itself.