August 26, 2011 5:22 PM

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Air India plans to stop operations on loss-making routes

Air India plans to stop operations on several loss-making routes to reduce expenditure and improve cash flow as the company's outstanding liabilities.Civil Aviation Minister Vayalar Ravi said in New Delhi on Friday that a group of ministers headed by Finance Minister Pranab Mukherjee has asked the airline to improve its cash flow and reduce losses.According to official figures, the airline has outstanding liabilities of over Rs.44,000 crore ($9.8 billion), nearly half of which are working capital loans. The debt-ridden carrier has to pay almost Rs. 3,200 crore as interest to its lenders.Mr. Ravi said the group of ministers would meet again next month to take some concrete decisions to improve the financial health of the national flag carrier.Asked whether the airline would cut jobs to control losses, he said: there is no question of cutting jobs. The minister said that the government has replaced the top management of the national carrier and asked the new team to take appropriate measures to improve cash flow of the company.

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