Extending a helping hand to Air India, the government today asked the Finance Ministry

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to critically examine the "extent of assistance" to be given to the national carrier and the Petroleum Ministry to extend the credit limit initially for three months.

This was decided at a meeting of the high-level committee, headed by Cabinet Secretary K M Chandrasekhar, set up to monitor Air India's cost cutting measures. The Committee met for the first time today and vetted the cash-strapped carrier's plans to cut costs and generate revenue.

Official sources said Air India's parent company, National Aviation Company of India Limited (NACIL) has been asked to appoint a Cost Auditor to monitor costs.

The auditor would ensure that cost reduction measures and operational efficiencies are implemented on a day-to-day basis, sources said.

The national carrier is estimated to suffer a loss of Rs 7,200 crore in the last financial year.