China's flag carrier Air China will receive another 1 billion yuan from the Chinese government following a 1.5 billion yuan injection early last year.

The airline's controlling shareholder China National Aviation Holding Company (CNAC) recently received Notice from the Ministry of Finance and Reply from the State-owned Assets Supervision and Administration Commission of the State Council to appropriate 1 billion yuan to the group, Air China announced on Sep. 1.

The 1 billion yuan fund will be injected into Air China by CNAC used to increase the airline's shareholdings in Cathay Pacific Airways Ltd. Given that the airline's stake increase have been executed, Air China will replace its early-stage investment after receiving the fund.

The airline's latest stake increase in Cathy Pacific took place in August 2009 when Air China raised its stake in Cathy Pacific to 29.99 percent by investing HK$6.335 billion, making it the Hong Kong-based carrier's second largest shareholder and enabling it to appoint two more non-executive directors in the Cathy Pacific board. However, the 1 billion yuan fund -- received two years later -- is far less than its last investment.

It is not the first time that the Chinese government invested into large state-owned aviation groups. In November 2008, China Eastern Airlines Corporation Limited, along with China Southern Air Holding Company jointly received 3 billion yuan from the State-owned Assets Supervision and Administration Commission of the State Council. Afterwards, China Eastern Airlines Corporation Limited received another 6 billion yuan from the government. All the funds were state-owned capital budget appropriated by the Ministry of Finance.

The CNAC had been applying for government's injection at that time, but received no response until January, 2010 when the CNAC won approval for 1.5 billion yuan state-owned capital budget from the Ministry of Finance, which was injected into Air China used to acquire Air China Cargo' stakes from minority stockholders.