The civil aviation ministry has asked the Delhi International Airport Ltd (DIAL) to bring down the interest rate charged on national carrier Air India's dues.

A senior civil aviation ministry official said that the DIAL (consortium that runs the Delhi airport) had been asked cut interest on Air India's dues to a rate it pays on its borrowings.

The state-owned airport operator had referred its dispute with the Airports Authority of India (AAI) over sharing of interest charged on Air India's dues to the OMDA Implementation Oversight Committee.

The committee suggested that the interest on the national carrier's dues should not be more than the rate of interest on borrowings.

Speaking on the topic, the ministry official said, "DIAL is charging an interest of 12 per cent on Air India dues, whereas, the interest rate on their borrowings are around 9.5 per cent. We have asked them to bring the interest rate charged on AI's dues in proportionate to the interest on their borrowings."

The proposed cut in interest rate on dues will provide the national carrier with a great financial respite, as the interest burden on the carrier's dues of around Rs 600 crore to Delhi Airport will slip by 2.5 percentage points. Air India owes nearly Rs 3,000 crore to different airport operators.