Mumbai, Nov 17 (IANS) The state-run National Aviation Co of India Ltd (NACIL) that runs Air India will get by January the first instalment of equity infusion by the government worth Rs.400 crore (Rs.4 billion), the company said in a statement Tuesday.

"The group of ministers has recently assured support to the national carrier in the form of equity infusion and the first instalment of Rs.400 crore is expected by January 2010," the company statement said. 

The announcement comes after Civil Aviation Minister Praful Patel last week said the government had agreed to infuse Rs.800 crore into the beleagured airline. 

"Further instalments would be tied up to the milestones of savings effected on account of cost-cutting exercise at various levels," the carrier said.

"We are simultaneously taking effective measures to enhance revenue to the extent feasible in today's market environment. We will also aggressively rationalize its fleet size and network besides pruning non-core activities in the coming months," NACIL said. 

Based on a monthly review of Air India's cost-cutting measures, the group of ministers on civil aviation, led by Finance Minister Pranab Mukherjee, recommended the equity infusion.

However, it also asked Air India to reduce costs by at least Rs.2,000 crore by the end of the current fiscal. 

The airline is also putting in place a payment plan to clear the arrears of various vendors following improved booking position between December-February, generally considered good months for the aviation industry. 

As per data released by the Directorate-General of Civil Aviation (DGCA), Air India has improved its performance with impressive gains in domestic market.

The carrier's domestic market share, which was 16.6 percent in August, rose to 17.5 percent in September and climbed to 18.6 percent last month.

Air India to continue with incentives for employees

New Delhi/Mumbai, Nov 17 (IANS) The National Aviation Co of India Ltd (NACIL) that runs national carrier Air India Tuesday decided to continue with the present performance linked incentives (PLI) as passenger load has picked up.

"In view of the improved passenger carriage in recent months, we are trying to address the issues concerning the delayed payments of the PLI to our employees," NACIL said in a statement. 

"While the delay (in clearing dues) ranged from one to two months, efforts are on to the clear the October PLI soon and in future the delay would not be more than a month," it said. 

The airline, which posted a loss of Rs.7,200 crore last fiscal, paid salaries for October but without incentives, which constitute a major chunk of the pay packages of its 31,500 employees. 

A PLI cut would have hit the carrier's 1,250 pilots and 7,000 engineers the most, with incentives accounting for about 75 percent of pilots' salaries. 

Just before the NACIL board began its deliberations Tuesday, pilots staged a silent protest march at Mumbai airport. 

Earlier in the day, a senior airline official told IANS that the company would look at adjusting cuts in PLI acceptable to all. 

The Indian Commercial Pilots Association (ICPA), which claims to have a membership of over 800, had also threatened to go on strike from Nov 24 if the dues were not cleared. 

The cash-strapped carrier is currently focusing on increasing revenues and market share. 

Its domestic market share, which was 16.6 percent in August, rose to 17.5 percent in September and climbed to 18.6 percent last month.

In a revenue shoring move, it also hiked domestic fares by up to Rs.200 following increase in jet fuel prices.

The government has asked the carrier to reduce costs by at least Rs.2,000 crore by the end of the current fiscal. The airline has posted a loss of over Rs.5,500 crore till now this fiscal.