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Patel likely to meet Air India employee unions tomorrow

india Updated: Oct 13, 2009 21:54 IST

PTI
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Civil Aviation Minister Praful Patel is likely to meet Air India staff unions, including pilots, on Tuesday to discuss rationalisation of incentives and allowances in line with the airline's turnaround plans.

"The Minister (Praful Patel) is likely to hold a meeting with the staff unions from a cross-section of departments on the turnaround plan," sources said.

The proposed meeting comes in the backdrop of the recent five-day long stir by executive pilots after the management suggested up to 50 per cent cuts in their productivity-linked incentive (PLI) and flying allowance.

The proposal was deferred after the employees, including pilots and engineers, vehemently opposed any cut, maintaining that the staffers should not be blamed for Air India's mounting losses.

There are 14 unions in the state-run airline representing engineers, pilots, cabin crew, officers and other employees.

Following the executive pilots' agitation, the government announced the formation of a sub-committee of the Air India Board to examine the issue in totality.

The sub-committee, which comprises Air India Chairman and Managing Director Arvind Jadhav and Joint Secretaries in the Civil Aviation Ministry, EK Bharat Bhushan and Prashant Shukul, would submit its recommendations to the airline's Board.

Besides the issues of allowances and incentives, the unions, which have been participating in the national carrier's Turnaround Committee proceedings, have already submitted several proposals to cut costs and enhance savings, Air India sources said here.

The proposed meeting of the minister with the airline's staff unions would be followed by another meeting with the Air India's Board's sub-committee shortly, they said.

The government has made it known to the airline that its demand for a financial package in the form of equity infusion and soft loan can come only after it started implementing a concrete turnaround plan in short, medium and long term.

The cash-strapped national carrier is expected to post losses to the tune of Rs 7,200 crore this fiscal.

Its turnaround plan includes steps to reduce costs, enhance revenues and business transformation measures, including reducing its high-cost debt.

The airline's working capital borrowings have crossed Rs 16,000 crore and sources said it is already in talks with some of the public sector banks for availing an additional Rs 1,500-2,000 crore as working capital loans.