New Delhi: Civil Aviation Minister Ashok Gajapathi Raju will review next week the performance of Air India, which is expected to have eked out "operating profit" last fiscal after being in the red for a decade. The minister will be reviewing the "operational and financial performance" of the national carrier on May 16, according to senior officials.
The review meeting, likely to be attended by Raju's deputy Mahesh Sharma and Civil Aviation Secretary R N Choubey along with other senior officials, comes ahead of the second anniversary of Prime Minister Narendra Modi-led NDA government at the Centre. A senior official at the airline said the minister will be taking a review after nearly six months. The last such meeting took place in November last year.
The Civil Aviation Secretary takes a review of the carrier every fortnight, he added. Grappling with tough market conditions and intense competition, Air India has been registering losses for quite some time, but the airline's performance has improved in the last few quarters. "Air India's all-time performance has increased.
This year, it is making profit, which is the first time in the last 10 years. It is making an operating profit. Air India is doing good work," Raju had said in Parliament last week. The carrier is expected to post an operating profit of Rs 8 crore in 2015-16.
In March, Sharma had said the airline is "expected to earn operating profit of Rs 8 crore as compared to the operating loss of Rs 2,636.18 crore in the previous year".
"This is the first time that the company is going to achieve operating profit since its merger in 2007-08," he had told the Rajya Sabha. Air India ran up losses to the tune of Rs 5,859.91 crore in 2014-15.
The improvement is anticipated mainly on account of a steep fall in the jet fuel price, which accounts for 40 per cent of an airline's operating expenses. In 2012, the government had extended a Rs 30,231-crore lifeline to the national carrier under a turnaround plan stretching over a period of nine years to keep it afloat.
This equity infusion includes the financial support towards repayment of principal as well as interest on government-guaranteed loans taken for aircraft acquisition by the airline. As per the 2012 Turn Around Plan (TAP), the government will infuse Rs 18,929 crore for repayment of government- guaranteed loans/interest till 2010-21....