The Government has said that it will increase funding for the national carrier RwandAir to Rwf145.1 billion in the 2020-21 fiscal year, from the current Rwf121.8 billion.
The increased transfers to the carrier are meant to facilitate the airline to respond to the impact of the COVID-19 pandemic.
The funds are also meant to facilitate the airline to continue its expansion process, including the acquisition of new planes and new routes.
RwandAir has been affected by the pandemic due to the travel bans countries have imposed on travelers across the world.
The airline suspended all commercial flights when Rwanda barred all commercial airlines to enter the country.
Rwandair has employed drastic measures including reduction of salaries of employees in an attempt to avoid layoffs.
The company reportedly put on hold contracts of some pilots and non-essential staff until further notice.
The Minister of Finance and Economic Planning Uzziel Ndagijimana said that the transport sector is among the sectors that have been hit by the pandemic.
Last year, 12 percent of transport services grew 12 per cent boosted mainly by a 17 per cent increase in air transport activities.
However, the sector is expected to contract by 1.9 per cent in 2020.
The increased funds could help the airline overcome the negative impact exerted by the new Coronavirus pandemic.
Rwf240.4 billion will go to the transport sector.
The Government will generally spend Rwf30.2 trillion in the next financial year, up from the revised budget of Rwf30 trillion.
Meanwhile, the Government said it will recapitalise the Development Bank of Rwanda (BRD) to continue to recapitalize the financial institution to enable it to expand to the private sector to promote accelerated growth.
In the fiscal year 2020-21, an amount of Rwf7.2 billion has been allocated to the institution.