As the aviation industry awaits the preliminary information memorandum on the government's divestment plan for Air India, the airline's earnings for the April-December period showed that the national carrier is trying to revive its growth engine.

Despite a substantial loss of revenue due to closure of Pakistan airspace during 2019, the airline has been able to post an improvement in 9-month earnings, largely due to the recovery of several wide-body aircraft which were grounded earlier for want of maintenance, sources said.

The airline's net loss narrowed by 46 percent year-over-year, while the yield rose by 6.7 percent, CNBC-TV18 has learnt. Passenger revenue grew by 14.7 percent Y-o-Y to around Rs 17,320 crore with passenger carrying capacity or ASK (Available Seat Kilometers) rising by 4.9 percent.

The seat factor rose by 2.6 percent. Cargo revenue also advanced by 10 percent during the April-December period to Rs 1,208 crore.

Overall, Air India was able to narrow its operating loss to Rs 1,040 crore during the 9-month period as compared to Rs 1,960 crore in the same period last year.

The airline has also posted better operating performance, with EBITDA turning positive at Rs 460 crore as compared to negative EBITDA figures last year.

"We have been able to recover most of our wide-body aircraft...the figure is more than eight, including two B777, 5-6 B787 and two B747. We have deployed the jumbo aircraft on domestic metro routes. This has largely helped us in showing a substantial improvement in our operations," a person aware of the development said.

As of March 2017, Air India had a total operating fleet of 104 aircraft, out of which 61 were narrow-body and 43 were wide-body.

A severe liquidity crisis at the airline delayed the recovery of 12 A320 aircraft, which are currently grounded, but the recovery of at least one of these narrow-body planes is in process, sources said.

CNBC-TV18 had exclusively reported earlier this month that Air India ended its 20-year old partnership with US-based GDS provider Sabre on account of a higher premium, and revived its tie-up with Amadeus for a better deal. The new GDS deal is expected to result in savings worth Rs 3,000 crore over the next five years.

The efforts taken by the government to make the airline an attractive investment also helped improve the bottom line for the period. In late 2018, CNBC-TV18 had exclusively reported that the Union government had decided to transfer Rs 29,464 crore of Air India's debt to a special purpose vehicle in order to lighten its balance sheet. The debt transfer in October 2019 helped Air India's bottom line to the extent of Rs 1,700 crore, sources said.

The ministerial panel formed to overview the divestment process of Air India has approved the draft expression of interest, share purchase agreement and preliminary information memorandum to sell 100 percent stake in Air India on January 7. The government is widely expected to invite expression of interest for Air India this month.

So far, the government has not changed foreign direct investment rules with respect to Air India. As per the current FDI norms and the Aircraft Act, a foreign carrier can hold up to 49 percent stake in Air India while the substantial ownership and effective control have to stay with Indian nationals.

CNBC-TV18 had also reported, quoting sources, in November 2019 that the government is planning to waive off the airline's payables to oil companies, airports and other vendors amounting to around Rs 22,000 crore to sweeten the deal.

This is over and above the airline's total debt of nearly Rs 60,000 crore, the sources added. As per provisional figures for FY 2018-19, Air India's total debt stood at Rs 58,351.93 crore.