Don’t sell Air India, give it five more years to revive itself: Parliamentary panel
Write off Air India’s massive debts and give it five more years to revive itself, a parliamentary panel has recommended.
Recalling the role played by the airline during natural calamities and in evacuating Indians from war zones, the parliamentary standing committee on transport, tourism and culture said it would be lopsided to assess and evaluate functioning of AI solely from business point of view as has been done by the Niti Aayog.
AI has been unable to service its aircraft purchase and working loan of over Rs 50,000 crore.
NDA members of the committee, who had stalled the draft report that recommended “against disinvestment” of AI at its meeting January 2018, now have to approve the report suggesting that the airline should not be disinvested now.
The governmen feels AI divestment should take place once the airline is in a better shape and the overall cost environment of all airlines — oil prices and the rupee exchange rate — improves. They now realise that AI can find buyers only if it is in a better shape and also comes with a smaller debt.
AI’s market share has eroded due to various government policies like indiscriminate allocation of routes, lucrative routes being assigned to private players, and equity infusion being done on a piecemeal basis, the report of the panel, headed by TMC’s Derek O’ Brien, said.
AI was forced to take loans to meet the shortfall, which was not contemplated under the financial restructuring plan, it said.
Recalling the role played by the airline during natural calamities and in evacuating Indians from war zones, the parliamentary standing committee on transport, tourism and culture said it would be lopsided to assess and evaluate functioning of AI solely from business point of view as has been done by the Niti Aayog.
AI has been unable to service its aircraft purchase and working loan of over Rs 50,000 crore.
NDA members of the committee, who had stalled the draft report that recommended “against disinvestment” of AI at its meeting January 2018, now have to approve the report suggesting that the airline should not be disinvested now.
The governmen feels AI divestment should take place once the airline is in a better shape and the overall cost environment of all airlines — oil prices and the rupee exchange rate — improves. They now realise that AI can find buyers only if it is in a better shape and also comes with a smaller debt.
AI’s market share has eroded due to various government policies like indiscriminate allocation of routes, lucrative routes being assigned to private players, and equity infusion being done on a piecemeal basis, the report of the panel, headed by TMC’s Derek O’ Brien, said.
AI was forced to take loans to meet the shortfall, which was not contemplated under the financial restructuring plan, it said.
(This article was originally published in The Times of India)
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