The recession-hit state run carrier Air India may get capital, as the government is working out plans to infuse funds through equity and debt in the ailing airline. The carrier has deferred proposed initial public offering of (IPO) of Air India till the recovery of global market conditions.

Union Civil Aviation Minister, Praful Patel said in the parliament that the carrier needs capital, given its unhealthy financial health, and the state is duty bound to extend a helping hand to the national airline in the ongoing difficult period.

Mr. Patel said: "An equity infusion and soft loan by the Government as a measure of softening the adverse financial situation is contemplated."

The National Aviation Co. of India Ltd has been planning to raise US$1billion loan, guaranteed by the US Export-Import Bank, from JPMorgan Chase, to add more aircrafts into its fleet.

This loan, being availed at around 100 basis points above the London inter-bank offered rate, would prove very much beneficial for the ailing airline that suffered an accumulated loss of about Rs 72 billion till March.