Air India plans more foreign flights to save fuel cost

Move is expected to help the airline get cheaper fuel in the overseas market

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Debt-ridden Air India plans to divert part of its capacity to nearby overseas destinations such as Dubai and Singapore to increase its revenue from operations. The move is expected to help the airline get cheaper fuel in the overseas market, thereby reducing operating cost and generating more cash compared with domestic flights.

As per a report in the Financial Express, the airline has taken the decision in the face of its inability to raise funds from banks and financial institutions. The airline’s daily losses have skyrocketed to about R20 crore compared with R14 crore a year-and-a-half ago. Air India loses on over 80% of its total 395 domestic and international flights.

“We are planning to put 8-10 domestic flights on international sectors. This would bring a little extra cash. Till the time newly-set up CoS (committee of secretaries) suggest ways to strengthen airline’s financials we have to look for all possible ways of enhancing revenues,” an airline official said.

Meanwhile, leading bankers, which were part of the R40,000-crore loan restructuring package of Air India, have asked for the government’s gurantee and other supports before they finalise and start fresh exposurre in the company.

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