Govt looking for new joint MD to steer AI revival

Air India has had two joint MDs since its merger with Indian Airlines in 2007, but the position is lying vacant since 2014

GN Bureau | September 20, 2016


#Air India   #revival   #joint MD   #Indian Airlines   #debt restructuring   #Narendra Modi  

 The government is seeking to hire a new joint managing director to steer Air India Ltd’s turnaround and debt restructuring plan.

 
According to a news report published in the Mint, the appointments committee of the cabinet (ACC), which is headed by prime minister Narendra Modi, has asked the aviation ministry to fill the position. It is vacant since 2014.
 
Air India has had two joint managing directors (MD) since its merger with Indian Airlines in 2007. Bureaucrat Vishwapati Trivedi was the first one to serve as joint MD. Syed Nasir Ali, an Indian Revenue Service officer deputed to the aviation ministry, served as joint managing director from 2012 to 2014. His tenure was not extended and since then the position has been vacant. The government has started the process to fill the position with someone who can be the eyes and ears of the government and help with the turnaround process, the news report added.
 
Air India is weighed down by debt of Rs 51,367 crore, because of purchase of new planes and working capital loans. In 2012, the airline secured a bailout package from the government. It included Rs 30,000 crore in equity infusion spread over 10 years and it was allowed to draw an average Rs 3,000 crore every year.
 
While the huge drop in the fuel price has helped the national carrier to make some operational profit. The government wants to find ways to reduce the debt of the airline further. This includes nearly Rs 28,000 crore owed to state-owned banks.
 

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