Business Companies 31 May 2017 Govt's proposal ...

Govt's proposal to privatise AI to benefit private carriers: CITU

Published May 31, 2017, 8:37 pm IST
Updated May 31, 2017, 8:37 pm IST
The major trade union also said that the move was against the national interest and ill-timed.
Representational Image
 Representational Image

New Delhi: The CITU today termed the government's proposal to privatise Air India as an exercise with a dubious intent to fritter away a national asset to benefit private airlines.

The major trade union also said that the move was against the national interest and ill-timed as it came when Air India has posted an operating profit for the first time in 10 years since its merger with Indian Airlines.


Finance minister Arun Jaitley had recently favoured disinvestment of the loss-making flag carrier, saying the airline's market share is just around 14 per cent whereas the debt burden was Rs 50,000 crore.

He had also said that the taxpayer's money could be better utilised such as for promoting education rather than in keeping the airline afloat. Following this, the civil aviation ministry yesterday said it has received recommendations from the NITI Aayog and is looking at all possible alternatives to make Air India viable.

"The privatisation of Air India is not for saving public money but for frittering away a national asset and exchequer for the benefit of private corporate and private airlines, both domestic and foreign.


This is an exercise with a dubious intent, totally against the national interest," a statement

issued by the Left affiliated Centre for Indian Trade Uinon (CITU). Air India is surviving on a Rs 30,000 crore bail-out package, spread over 10 years, announced by the Manmohan Singh government in 2012.

In 2015-16, the airline posted operational profit of Rs 105 crore on account of low fuel prices and increased passenger numbers. According to CITU, the Air India has accumulated such a huge loss due to the burden of debt servicing.

It also said that the successive government's at the Centre, and not the airline's management, were to be blamed for the financial mess of Air India. "Air India which had been a profit making company till 2007, pushed to loss and debt-burdened by the bungling and disastrous experiments by the successive governments at the Centre on the national carrier's organisational structure.


For this, the company management cannot be held responsible," the statement said.

CITU has also asked that if the government is willing to write off the Rs 30,000 crore debt for the prospective private buyer why it could not make a similar offer to Air India.

The CBI has registered three FIRs and a preliminary enquiry (PE) to go into the controversial decisions made by the erstwhile UPA government with regard to the merger of Air India and Indian Airlines, purchase of 111 aircraft and surrendering of profitable routes to favour private airlines.


Location: India, Delhi, New Delhi