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The government has facilitated and incentivised a regional and small-town air connectivity framework that is ambitious and welcome. Does it need to continue to subsidise well-to-do passengers who fly Air India and have in any case transferred a bulk of their domestic and international travel to more efficient private airlines, some of them Indian-owned? This is not just a wider philosophical question. In the coming period, the Modi government has to take substantial calls on the taxpayers continued largesse to Air India. The airlines current debt is Rs 46,000 crore. It does not earn enough to service this debt and each year borrows Rs 4,000 crore to pay interest on existing debt while, logically, also adding to that debt. In 2012, the UPA government announced a 10-year programme of injecting Rs 30,000 crore into Air India. Today, the airline can manage its operational costs. The money injected by the government is used to pay interest on existing loans. In the five years since 2012, Rs 26,000 crore of the promised Rs 30,000 crore has already been disbursed. What remains (Rs 4,000 crore) can fulfil interest payments for only one more year.
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