Minister’s Remark on Air India Privatisation ‘Highly Damaging', Says Employees' Union

New Delhi: Civil Aviation Minister Hardeep Singh Puri's recent statement in Rajya Sabha that Air India would have to be closed down if not privatised is "highly damaging" and would have "massive financial implications" for the national carrier, an employees' union said on Thursday.

In a letter to Prime Minister Narendra Modi, the Aviation Industry Employees' Guild said "Coming from the civil aviation minister...this statement is highly damaging, uncalled for at this stage and has massive financial implications for Air India, as our passengers will start cancelling their flight bookings and/or prospective passengers refrain from booking seats on AI flights from March 2020 or even before."

"Considering the tremendous repercussions the statement may have, it would be in the interest of Air India to prevail upon the Honourable Minister not only to withdraw the statement made by him but also to refrain from making any such irresponsible statements in future," the letter said.

On Wednesday, Puri had said in Rajya Sabha that the loss-making Air India would have to be “closed down if not privatised”, while adding that the government was committed to secure a favourable deal for all employees of the State-owned carrier.

The government is in the process of finalising invitation of bids, he had said, adding "Your airlines would have to be closed down if not privatized." The minister was replying to a supplementary question.

"... The process of disinvestment is underway. The issue of getting bids will arise only after we complete the processing. So far, the alternative mechanism, under the chairmanship of the Home Minister, has been made," he said.

"We have taken some decisions. Other decisions are being processed. Once we invite bids, then, we will see how many bids have come in," Puri added.

On employees' concern, he said, "Issues being related to current employees, their health cover, how many would remain and what would happen, we are committed to secure a favourable deal for all employees."

While replying to a separate query, Puri rejected recent reports suggesting that several pilots of Air India were leaving the airline as their salaries are not being paid on time.

"Air India pilots are very well looked after and their salaries in relation to what other air carriers are offering are very good," said Puri.

He further said, "Insofar as resignations are concerned, I have not heard of any single case where anybody has resigned."

Puri said 25% salaries of various employees were withheld when Air India was in financial crisis.

There is full intention that before the privatisation or disinvestment is completed, this 25% would be reimbursed to all employees in all segments," he said.

The minister also assured the House that there would be no job loss in Air India till privatisation.

On November 17, Finance Minister Nirmala Sitharaman had said that the government is looking to wrap up the sale of state-run companies Air India by March 2020.

Earlier, the plan to sell Air India did not go through for lack of investors and the lukewarm response to its sale.

The ailing national carrier has a debt of around Rs 58,000 crore.

In a written reply to a question in Lok Sabha on Friday, Puri said that Air India faced a loss of Rs 4,685 crore in FY19 due to high fuel costs and forex rate variation.

"Aviation Turbine Fuel (ATF) costs increased from Rs 7,363 crore in 2017-18 to Rs 10,034 crore in 2018-19 i.e. an increase of almost 28.9 per cent in fuel rates over the previous year," he said.