Air India Maharaja’s last breather kit

The Maharaja is bleeding and it requires a life support.  As of today, Air India’s debt stands at Rs. 42,570 crore and losses are to the tune of Rs. 22,000 crore. The recent infusion of the Rs 1,200 crore package has not had any affect in the financial position. The opposition parties are accusing the Ministry for having let the Airliner bleed so that privatization would be only visible option left with the Government.

Airindia Maharaja

Mr. Narayanasamy, responding on behalf of Civil Aviation Minister Vayalar Ravi who is suffering from a throat infection, stated that privatization was not an option considered. He also stated that “If government found any officer responsible for the losses, government will take action. Government has an open mind, … government will definitely consider that … action against officers responsible”. Civil Aviation Minister Vayalar Ravi later said that three new directors would be inducted in the Air India Board very soon for the Personnel, Marketing and Finance departments. The government also plans to soon bring eminent persons from financial and hospitality sectors to serve as independent directors on the AI board as former FICCI official and present West Bengal Finance Minister Amit Mitra and vice-chairman of the Mahindra Group Anand Mahindra had quit as independent directors in the board.

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 management and staff to reflect the present market conditions. On issues pending from the merger, especially concerning human resources, the Minister said a Committee headed by Justice Dharmadhikari was soon going to submit its recommendations to the government.

Air India now has a new C&MD, Mr. Rohit Nandan, a U.P. cadre IAS officer of 1982 batch. His appointment as Air India CMD is also for three years. He is the third C&MD of Air India in as many years. Mr. Nandan, a joint secretary in the Civil Aviation Ministry, replaces Arvind Jadhav, a senior IAS officer, who has been given marching orders and repatriated to his parent cadre in Karnataka. Mr. Jadhav’s three-year term was to end in May 2012 but his failure on all parameters and lacklustre performance only hurried his exit from the airline which finds itself sunken in huge financial losses.

“My first priority will be to work on Air India’s turnaround and cut financial losses. Second will to be raise employees’ morale at all levels and third to upgrade service quality to match up to the expectations of travelling public. It is too early for me to give any timeline,” stated Mr. Nandan.

This looks like the last survivor kit with the government; else the airliner would nosedive.