Govt plans to set up expert panel to improve Air India's performance

New Delhi, Feb 24: The government plans to set up an expert panel to find ways to improve Air India's performance but presently no proposal is being considered for its privatisation, Civil Aviation Minister Ashok Gajapathi Raju Pusapati said today.

"Setting up of an expert committee to suggest ways to further improve the performance of Air India is under consideration," he said.

Will Air India's performance improve?

In April 2012, the government had approved a turnaround as well as financial restructuring plans for the carrier. Under these plans, there would be an equity infusion of Rs 30,231 crore up to 2012 provided the airline meets certain milestones. "Air India has considerably improved its financial and operational performance," the Minister said in a written reply to the Rajya Sabha.

An oversight committee, whose members include Civil Aviation Secretary and Expenditure Secretary, has been constituted to closely monitor the performance of Air India vis-a-vis the milestones set in the turnaround plan. Besides, the carrier has taken various cost cutting measures to improve its financial position.

These include rationalisation of loss-making routes, freezing employment in non-operational areas, closure of overseas offline offices at certain locations, phasing out of old fleet and consequential reduction in maintenance cost. In response to a query on whether privatisation of Air India is the only way out to improve its performance, the Minister said, "At present, no proposal for privatisation of Air India is under consideration of the government".

In response to a separate query on whether Air India is planning to monetise its surplus land assets to reduce its mounting debts, Minister of State for Civil Aviation Mahesh Sharma replied in the affirmative. "Recently, Air India has signed an MoU (Memorandum of Understanding) with NBCC to develop its land parcels on joint venture basis," he said in a written reply. Sharma said that Air India's total manpower stood at 21,586 people as on January 1, 2015.

This includes employees who have been transferred or deputed to the carrier's subsidiaries -- Air India Engineering Services Ltd and Air India Air Transport Services Ltd. Out of the total, 11,869 people were with Air India. Aircraft to employees ratio as on January 1, 2015 in Air India stood at "1:122", excluding the employees who have been transferred or deputed to its subsidiaries.


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