Take the pledge to vote

For a better tommorow#AajSawaroApnaKal
  • I agree to receive emails from News18

  • I promise to vote in this year's elections no matter what the odds are.
  • Please check above checkbox.

    SUBMIT

Thank you for
taking the pledge

Vote responsibly as each vote counts
and makes a diffrence

Disclaimer:

Issued in public interest by HDFC Life. HDFC Life Insurance Company Limited (Formerly HDFC Standard Life Insurance Company Limited) (“HDFC Life”). CIN: L65110MH2000PLC128245, IRDAI Reg. No. 101 . The name/letters "HDFC" in the name/logo of the company belongs to Housing Development Finance Corporation Limited ("HDFC Limited") and is used by HDFC Life under an agreement entered into with HDFC Limited. ARN EU/04/19/13618
LIVE TV DownloadNews18 App
News18 English
News18 » Business
3-min read

Don't Privatise Air India Just Yet, Give It Time Till 2022, Says Parliamentary Panel

It also said that as some of its subsidiaries Air India Air Transport Services Limited (AIATSL), Air India SATS Airport Services Private Limited (AISATS), Alliance Air and Air India Express were making profits, these units should "not be disinvested."

PTI

Updated:January 7, 2018, 12:36 PM IST
facebookTwitter Pocket whatsapp
Don't Privatise Air India Just Yet, Give It Time Till 2022, Says Parliamentary Panel
Representative image.

New Delhi: This is not an appropriate time to divest government stake in Air India, which should be given at least five years to revive and its debt written off, a Parliamentary panel is likely to tell the government.

The panel is also understood to have concluded that the equity infusion in the national carrier, as part of the turnaround plan (TAP), was made on a "piece meal basis", adversely affecting its financial and operational performance and "forcing" the airline to take loans "at a higher interest rate to meet the shortfall".

The Parliamentary Standing Committee on Transport, Tourism and Culture concluded that the government should review its decision to privatise or disinvest Air India and explore the possibility of "an alternative to disinvestment of our national carrier which is our national pride".

Observing that Air India has always "risen to the occasion" at times of need like calamities, social or political unrest in India or abroad, the Committee said "it would be lopsided to assess and evaluate the functioning of Air India solely from business point of view, as has been done by the NITI Aayog."

In its revised draft report on the airline's proposed disinvestment, the panel noted that the TAP and financial restructuring plan (FRP) was for a period of 10 years from 2012 to 2022 and Air India has shown "an overall improvement in various parameters and every indication is that it is coming out of the red".

"At the end of TAP period, government may evaluate the financial and performance status of Air India and take a decision accordingly," the panel said.

The parliamentary committee, after hearing the views of all stakeholders, "strongly feels that it will not be appropriate at this stage to disinvest when Air India has started earning profit from its operations."

It also said that as some of its subsidiaries Air India Air Transport Services Limited (AIATSL), Air India SATS Airport Services Private Limited (AISATS), Alliance Air and Air India Express were making profits, these units should "not be disinvested."

Strongly recommending that the airline's debt "should be written off by the government", the revised draft report said, "Air India should be given a chance for at least five years to revive themselves". The tenure of five years indicates the end of the TAP and FRP period in 2022.

It said the airline's debt was "due to policy directions of the Ministry of Civil Aviation. Air India may be permitted to function as a government PSU with less government control."

The Committee also expressed apprehension that Air India's strategic disinvestment "would result in job loss of many people" and asked the government to "make an assessment" of the job loss before deciding on stake sale.

"If the disinvestment of Air India and its subsidiaries is inevitable, the Committee emphatically recommends that the interests of employees should be protected," the revised draft report said.

It asked the Ministries of Finance and Civil Aviation to "develop a strategic package to protect the rights and interests of officers and staff of Air India and its subsidiaries in respect of their pension, gratuity and VRS and also the wages of contractual workers engaged by government from time to time in case the disinvestment of Air India is inevitable."

The panel found merit in the views of some of its members that if Air India is withdrawn from the aviation scene, "private airlines would indulge in gouging and that (will not be) in the interest of the consumers."

Air India has a total debt of about Rs 48,877 crore at the end of March 2017, of which about Rs 17,360 crore were aircraft loans and Rs 31,517 crore were working capital loans.

The airline is expected to report a net loss of Rs 3,579 crore for 2017-18, as per budget estimates projected for 2017 -18 from a provisional net loss of Rs 3,643 crore for 2016-17.

The airline is projected to increase its operating profit to Rs 531 crore (BE projected) for 2017-18 from a provisional operating profit of Rs 215 crore for 2016-17, as per latest figures tabled in Parliament.

Get the best of News18 delivered to your inbox - subscribe to News18 Daybreak. Follow News18.com on Twitter, Instagram, Facebook, Telegram, TikTok and on YouTube, and stay in the know with what's happening in the world around you – in real time.

| Edited by: Sanchari Chatterjee
Read full article
Next Story
Next Story

facebookTwitter Pocket whatsapp
Most Active
Company Price Change %Gain
Bharti Airtel 409.20 4.11
Glenmark 365.55 21.45
SBI 325.10 0.99
Yes Bank 65.85 -4.15
ICICI Bank 498.35 -0.30
Company Price Change %Gain
Maruti Suzuki 7,099.60 -0.66
Yes Bank 65.90 -4.08
TCS 2,151.75 -1.06
Bharti Airtel 409.15 4.06
SBI 325.20 0.99
Top Gainers
Company Price Change %Gain
Bharti Airtel 409.20 4.11
Tata Steel 410.05 3.94
UPL 549.00 3.53
Hindalco 193.60 3.12
BPCL 521.75 3.00
Company Price Change %Gain
Bharti Airtel 409.15 4.06
Tata Steel 410.20 4.01
Sun Pharma 424.35 2.28
Power Grid Corp 190.65 1.79
IndusInd Bank 1,374.80 1.13
Top Losers
Company Price Change %Gain
Yes Bank 65.85 -4.15
Bajaj Auto 3,156.90 -1.82
Britannia 3,140.90 -1.71
M&M 573.70 -1.60
Hero Motocorp 2,502.90 -1.58
Company Price Change %Gain
Yes Bank 65.90 -4.08
Bajaj Auto 3,157.40 -1.69
M&M 573.15 -1.61
Hero Motocorp 2,505.00 -1.49
Asian Paints 1,738.80 -1.30

Live TV

Countdown To Elections Results
To Assembly Elections 2018 Results