The Tata group is in talks with banks to secure working capital loans of around Rs 15,000 crore for Air India, the airline that bought it from the government last year and is making a valiant effort to revive it, The Economic reported. times.
According to one knowledgeable person, the funds will be used to cover day-to-day air operations and losses, repair the fleet, pay for aircraft rentals and overhaul IT systems.
According to another source, the loan has a term of three years with an annual reset of between 7.5 and 8 percent.
Last year, State Bank of India (SBI), HDFC Bank and Bank of Baroda provided an unsecured loan of Rs 23,000 crore to Talace, a Tata Sons company that won the bid for Air India, at a rate of 4.25 percent. . The loan must be extended at the end of January.
According to a bank official, rising interest rates and a lack of liquidity in the system will increase borrowing costs. The Reserve Bank of India website lists 6.91 percent as the cut-off for 364-day Treasury bills.
Tata Sons won the bid through Talace in October last year to buy Air India for Rs 18,000 crore. About 69 years after the government nationalized the airline in August 1953, it took ownership of the airline in January of this year.
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