Struggling Air India to Pay in Advance to Utilize the Services at Four airports

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Air India will have to make a payment on a daily or per flight basis for parking and landing purposes at four airports including Ahmedabad, Bhubaneswar, Chennai, and Kolkata.

The Airports Authority of India (AAI) decided to put Air India on cash and carry mode from July 7 owing to the accumulation of dues for a long period.

“The competent authority has approved to put the operations of Air India on cash & carry” basis…. with effect from 1 hrs of 7 July 2020. The above may please be brought to the information of all concerned officials…” the AAI said in a circular.

Responding to this, Air India asked the AAI to reverse this decision, as cash and carry would bring additional financial stress on its liquidity.

“As you are aware Air India is in stressed financial condition due to COVID-19. At this stage, Cash & Carry would bring additional financial stress on Air India liquidity. You are requested to reconsider the above decision and give some more time for the release of dues till the situation normalizes for our flight operations,” Air India said in a letter.

“Air India has made a payment of ₹2 crores on July 2, 2020, and you are requested to settle dues for Ahmedabad, Bhubaneswar, Chennai & Kolkata effective July 7, 2020, against the payment of ₹2 crores. You are also requested to advise the station-wise adjustments are made for above ₹2 crores to avoid reconciliation issues in the future,” the letter added.