June 7, 2018 / 7:14 PM / 10 months ago

Ailing carrier Air India seeks 10 billion-rupee short-term loan

FILE PHOTO: An Air India Airbus A320neo plane takes off in Colomiers near Toulouse, France, December 13, 2017. REUTERS/Regis Duvignau/File Photo

MUMBAI (Reuters) - State-run carrier Air India is seeking a short-term loan of 10 billion rupees ($148.26 million) so it can continue day-to-day operations, according to an announcement on its website on Thursday.

The move reflects the dire financial straits of the debt-ridden national carrier. It runs some of the most lucrative routes in India and overseas, but it is struggling with bloated costs.

The search for a loan comes a week after the government failed to attract bidders for a stake in the airline, despite Prime Minister Narendra Modi’s efforts to raise capital by selling the ailing carrier.

The latest proposal by the airline asks bankers to submit their loan proposals by June 13. It would draw the loan in the current month, the statement here.pdf said.

India came up with plans in late March to divest a 76 percent stake in the carrier. After a lacklustre response, it tweaked the terms of the sale and extended the deadline for submitting bids.

Reporting by Promit Mukherjee, editing by Larry King

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