The new loan revamp plan of the loss making industry of Air India has got an approval from the Reserve Bank Of India today. The restructured proposal was submitted by SBI Caps for the airline. Banks will now be able to extend the tenure of loans and convert part of loans into cumulative redeemable preference shares (CRPS) and cash credit. According to this new revamp, banks will be given a time period of 4 months to restructure its process.
Going by this restructuring process, the repayment period for loans is likely to be raised to 15 years from the current 10 years. It is also hinted that the interest rates are likely to come down. However, officials at the RBI said that this has got nothing to with Air India. The restructuring plan is for the banks.
However, such a revamp will indirectly help Air India to come out of his debts and losses. Air India is reported to have a debt of Rs 43,777 crore and cumulative losses of around Rs 20,000 crore.
Report by Anupama