The government is trying to rescue Air India from its massive debts through disinvestment, it has been reported that the state-run airline is set to promote hundreds of employees with a hefty pay hike.
Air India was all set to give promotions to its 100 of pilots with a pay hike of up to Rs 12 lakh per head. “The 100 deputy general manager rank pilots are narrow-body and widebody pilots. These pilots are likely to be promoted to executive despite the fact that the airline is being privatised,” a source said.
This comes even after the government has begun the process of privatisation of Air India. To justify this action, some of the officials said that the staff in the operations department had not been promoted for the past 8 to 10 years. “Which is why it is being done,” said.
Ironically, the report comes a day after the government announced that it has released funds to Air India for purchase and modification of two VVIP aircraft from the National Small Savings Funds (NSSF) account.
On Tuesday, Union minister Jayant Sinha said that Air India had proposed to seek a short term loan of USD 180 million from Bank of Baroda, which was selected by way of tender process for the modification of two Boeing 777-300 ER aircrafts for Special Extra Section Flights of the government.
“However, this loan was not taken as the Government of India has released the required funds/ amounts from National Small Savings Funds (NSSF) account for the payment towards both procurement and modification of these two B777-300 ER aircraft,” Sinha said in a written reply to Rajya Sabha.
Last year in June, the Union Cabinet had approved privatisation of the state-owned airline. This year in January, the Cabinet allowed foreign airlines to invest upto 49 per cent in Air India. A group headed by Finance Minister Arun Jaitley with Rothschild and Ernst & Young as consultants has been appointed to chalk out the strategy for Air India’s stake sale.
The government is likely to split up Air India’s various businesses before offering it for sale. The airline has six subsidiaries, out of which three are making losses, with assets worth about USD 4.6 billion. The government has pumped USD 3.6 billion since 2012 to bail out the airline.>