Lok Sabha Question No. 1717 (UNSTARRED), answered on 2021-02-11
Subject: Financial Performance of Air India
Ministry: CIVIL AVIATION
Asked by: Ramya  Haridas

## GOVERNMENT OF INDIA

UNSTARRED QUESTION NO. : 1717

## MINISTRY OF CIVIL AVIATION LOK SABHA

(To be answered on the Ith February 2021)

## FINANCIAL PERFORMANCE OF AIR INDIA

## 1717. MS. RAMYA HARIDAS

Will the Minister of CIVIL AVIA TION

be pleased to state:-

- (a) whether civil aviation sector of the country is facing financial and liquidity problems;
- (c) whether there is any proposal under consideration of the Government for above stated problems; and

## ANSWER

Minister of State (IC) in the Ministry of CIVIL AVIATION

(Shri Hardeep Singh Puri)

- (a) (b) Based on the information received from the stakeholders, the airline carriers have been severely affected due to restrictions O domestic and international passenger movements in the wake of the COVID-19 pandemic, as per details given below:
- (ii) The revenue of AAI airports has reduced from INR 12,837 crore during FY 2019-20 to estimated revenue of around INR 4755 crore during FY 202021.
- (i) Revenues Of major Indian scheduled carriers fell from INR 46,711 crore during April-September 2019 to about INR 11,810 crore during AprilSeptember 2020.
- (iii) have ceased operations from 24 July 2020 and 30 July 2020 respectively:
- (iv) Domestic air cargo handled feil from 1.15 million metric tonnes (MMT) during March-December 2019 to 0.72 MMT during March-December 2020, while international air cargo handled fell from 1.74 MMT to 1.19 MMT:

The details of the financial performance 0f Air India during the last five years are aS under:

- () if s0, the details thereof including state of financial performance of Air India and other airlines services in the country;
- (d) if the details thereof? SO,
- (c) & (d) All efforts have been made to support the aviation sector in the country. Some of the measures taken are as under:
1. Domestic air services have been restarted in a calibrated manner: Initially, only one-third (33%) of the summer schedule 2020 was allowed to be operated which was subsequently increased progressively to 45% on 26 Jun 2020 then to 80% on 03 December 2020.
3. As on 29 Jan 2021, exclusive air-links 0r Air Bubbles have been established with 24 countries namely Afghanistan; Bahrain; Bangladesh; Bhutan, Canada, Ethiopia, France, Germany, Japan, Kenya, KuwaitMaldives; Nepal Netherlands; Nigeria, Oman; Qatar, Rwanda, Tanzania, Ukraine, UAE, UK and USA These are temporary arrangements aimed at restarting international passenger services while regular international flights remain suspended due to COVID-19. In addition t0 this, international flights are being operated on many sectors under Vande Bharat Mission. Iraq,
2. Operation of Regional Connectivity Scheme (RCS) UDAN (Ude Desh Ka Aam Nagrik) flights were allowed without the above-mentioned restrictions.
4. Provide airport infrastructure through Airports Authority of India (AAI) and the private operators:
- 6 Regulate the aviation industry through Directorate General of Civil Aviation to ensure safety standards.
5. Provide an efficient Air Navigation System:
- 7 Coordinate with stakeholders to resolve issues.
9. Reduction of Central Excise Duty applicable on ATF from 1A% to 11% w.ef: 11 October 2018 and rationalization of Goods and Services Tax (GST) provisions across aviation services.
8. Provide Viability Funding and other concessions to selected airline operators under Regional Connectivity Scheme (RCS) UDAN (Ude Desh ka Aam Nagrik) as per the scheme document: Gap
10. Rationalization of Category-I routes under Route Dispersal Guidelines on the basis of criteria given in National Civil Avation Policy 2016.
12. Liberalized domestic code share points in India within the framework of Air Service Agreements:
11. Modified the requirement for 5/20 and all airlines can commence international operations provided that they deploy 20 aircraft or 20% of total capacity (in terms of average number; of seats on all departures put together) whichever is higher for domestic operations:
13. 100% Foreign Direct Investment (FDI) under automatic route allowed in

| FY                      | Total Revenue           |   (Rs: in crore) Net Loss |
|-------------------------|-------------------------|---------------------------|
| 2015-16                 | 20,526.12               |                   3836.78 |
| 2016-17                 | 22,177.68               |                   5765.11 |
| 2017-18                 | 23,900.50               |                   5348.18 |
| 2018-19                 | 26,430.58               |                   8556.35 |
| 2019-20(Prov) 27,546.58 | 2019-20(Prov) 27,546.58 |                   7982.83 |

brownfield airport projects. FDI for Scheduled Air Transport Servicel Domestic Scheduled Passenger Airline has been allowed upto 49% ,under automatic route. For Non-Resident Indians (NRIs), 100% FDI will continue to be allowed under automatic route. Foreign airlines would be allowed to invest in capital of Indian companies operating scheduled and non-scheduled air transport services up to the limit of 49% of their up capital, subject to the condition; inter alia, that the scheduled and non-scheduled operators permit would be granted only to 4 company substantial ownership and effective control Of which is vested in Indian nationals. paid

15. GST rate reduced to 5% for domestic Maintenance, Repair and Overhaul (MRO) services.
14. Government of India provides some financial assistance to Air India.
16. Permit 100% FDI in MRO on automatic route:
4. 18 Route rationalization in Indian airspace in coordination with Indian Air Force for efficient airspace management; shorter routes and lower fuel cons wmption.
17. Encourage Indian carriers to increase their share in international air cargo traffic:
6. The Government has been actively supporting the revival package of Air India Ltd: as laid down in the Turnaround Plan (TAP) as well as the Financial Restructuring Plan (FRP) keeping in view the committment of the Government for disinvestment of Air India Ltd.