Alliance Air, the regional carrier owned by AI Assets Holding Ltd, a special-purpose vehicle formed by the Indian government, is to receive an equity infusion of INR 300 crore ($40.2m) from the government to help the disinvestment-bound airline cope with financial difficulties.
Alliance Air, which operates approximately 130 flights daily, was formerly part of Air India and has faced strikes by pilots protesting against non-payment of salaries and allowances. Flights under the Alliance Air brand are operated by Airline Allied Services, which has changed its name to Alliance Air Aviation Ltd.
Four other companies that were previously part of Air India, including Air India Air Transport Services and Air India Engineering Services, are also owned by AI Assets Holding and are proposed to be divested by the government in due course.
Alliance Air’s net loss for fiscal 2021-22 widened to INR 447.76 crore, and the carrier’s cash loss for the financial year ended March 2022 was INR 224.18 crore. In January 2022, Tata Group took over loss-making Air India and Air India Express. The Expression of Interest for Air India Air Transport Services and Air India Engineering Services is expected to be floated soon.
