Prime Minister Manmohan Singh today acknowledged that national carrier Air India was passing through a "difficult phase" but sought to put the blame for the situation on global recession and high cost of operation as per a PTI report.

"Air India is passing through a difficult phase as a result of global recession and high cost of operation. Equity support has been injected in 2010 and 2011. Turn-around plan of Air India is being closely monitored," Singh said in the report- "Government of the UPA: Report to the people"- on completion of two years of UPA-II.

The Government said it is closely watching the turnaround plan of national carrier Air India, which is saddled with a heavy debt of up to Rs 40,000 crore. Equity support of Rs 2,000 crore has been injected in 2010 & 2011.

The airline is faced with a debt of about Rs 40,000 crore, of which Rs 18,000 crore is working capital loans taken from a consortium of banks, while the balance Rs 22,000 crore worth of loans is towards payment of new aircraft ordered.

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