New Delhi: Air India has extended by one week the date to accept the bid by foreign banks and financial institutions offering loan to the national carrier which aims to raise USD 300 million through external commercial borrowing (overseas loans) to meet its working capital requirements.
The last date for accepting invitation of offers for external commercial borrowing (ECB) to the tune of up to USD 300 million has been extended to May 4 from April 27.
"We have received a good response to our initial tenders. And encouraged by this response, we have decided to extend the date for the invitation offers by one more week to get more competitive interest rates," a senior Air India official said.
Air India had on April 9 floated an international tender for raising up to USD 300 million through ECB window.
This ECB would be guaranteed by the Government of India and interest rate is fixed or floating linked to Libor (London inter-bank offered rate), according to the offer for invitation document.
Reserve Bank of India had for the first time in April 2012 allowed the civil aviation sector to raise funds via the ECB route for a period of one year.
The facility for the airlines has, however, already been extended twice.
The last extension expired on March 31 this year but the airlines expect the facility would be further extended by one year, to March 31, 2016.
The ceiling for the entire civil aviation sector to raise funds through ECB route currently stands at USD one billion, and the maximum permissible ECB limit for an individual airline is USD 300 million.
The funds raised through this route can be utilised for working capital as well as refinancing the outstanding working capital Rupee loan availed of from the domestic banks.
