"Government Allocates Rs. 11,158 Crore Funding to Alliance Air"

In a significant development for Alliance Air, the sole government-owned airline, the government has allocated a substantial investment of Rs. 1,158 crore in the budget for the fiscal year 2025. This comes as a crucial financial boost for the airline, which plays a key role in regional air connectivity.

While the government had initially allocated Rs. 1,174 crore in the last budget, an additional infusion of Rs 600 crore followed subsequently. The total investment for the fiscal year 2025 stands at Rs. 1,158 crore.

Sources indicate that the funds will be utilized to provide financial relief on the working capital front and address some of the airline's existing debt. Currently, Alliance Air operates 57 domestic and one international destination, boasting a fleet that includes 18 ATR72-600 aircraft, two ATR 42-600 aircraft, and one Dornier Do-228. The induction of the airline's second 'Made in India' Dornier aircraft is expected shortly.

Notably, Alliance Air is a significant participant in the UDAN (regional air connectivity) scheme, operating around 60 flights daily. A senior executive from Alliance Air expressed plans to increase the frequency of flights to Agatti in Lakshadweep and airports in Arunachal Pradesh. Additionally, a feasibility study will be conducted to assess the viability of operating flights from other Indian cities to Agatti.

The government's financial support is particularly crucial for Alliance Air, as the ongoing privatization process restricts the airline from securing additional borrowings. This capital infusion is seen as a pivotal move by the government to assist the airline in navigating the current financial challenges.

ET