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Government promises all steps to put AI on track

Posted by on August 13, 2011 0 Comment

Under sharp criticism from the Opposition over the poor financial health of Air India, the Union government on Friday ruled out any move to privatise the airline. It said all possible steps were being taken to put it back on track to make it a viable and competitive entity within a foreseeable future.

Responding to members’ concern expressed during a calling attention motion in the Lok Sabha, Minister of State for Parliamentary Affairs V. Narayanasamy said the government would provide “all possible support” to strengthen the state carrier.

Raising the matter, Gurudas Dasgupta of the Communist Party of India accused the government of deliberately leading Air India to bankruptcy to privatise it. The Bharatiya Janata Party members said the government was doing nothing to help the bleeding ‘Maharaja,’ which used to be a symbol of prestige, and was now on death bed.

Mr. Narayansamy said the salaries, including the productivity-linked incentives up to June, were paid to the employees and the government had released money for paying the dues for July.

Targeting Air India’s chairman and managing director for the mess and attacking the Prime Minister’s Office for his appointment, the Opposition demanded an overhaul of the entire management followed by full financial infusion. It contended that the recent Rs. 1,200-crore package was not enough.

Replying on behalf of Civil Aviation Minister Vayalar Ravi, who is suffering from a throat infection, Mr. Narayanasamy, said several steps were being taken to turn around the airline that included a complete “rationalisation” of manpower. “If any officer is found responsible for the losses, government will take action.” Dissatisfied with the reply, the Opposition members staged a walkout.

Noting that a Group of Ministers was looking into the problems of Air India, Mr. Narayanasamy said a turnaround plan with financial support would be unveiled soon. The entire exercise of finalising the Financial Restructuring Plan and restructuring of loans would take about three months.

Overcoming debt

The Minister pointed out that Air India suffered due to declining passenger load and competition from private airlines after the ‘Open Skies’ Policy initiated in 2003 during the NDA rule. The airline was facing a debt of over Rs. 44,000 crore and a scheme was being worked out to address it.

Measures under consideration include rationalisation of routes to cut losses, rescheduling of aircraft, complete rationalisation of manpower, redeployment of staff, reduction in contractual appointments, aligning all operational and technical agreements between the management and staff to reflect the present market conditions. Hindu

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