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'Don't privatise Air India; give it 5 years to revive'

Agencies
January 7, 2018

New Delhi, Jan 7: This is not an appropriate time to divest government stake in Air India, which should be given at least five years to revive and its debt is written off, a parliamentary panel is likely to tell the government.

The panel is also understood to have concluded that the equity infusion in the national carrier, as part of the turnaround plan (TAP), was made on a "piecemeal basis", adversely affecting its financial and operational performance and "forcing" the airline to take loans "at a higher interest rate to meet the shortfall".

The Parliamentary Standing Committee on Transport, Tourism and Culture concluded that the government should review its decision to privatise or disinvest Air India and explore the possibility of "an alternative to disinvestment of our national carrier which is our national pride".

Observing that Air India has always "risen to the occasion" at times of need like calamities, social or political unrest in India or abroad, the Committee said "it would be lopsided to assess and evaluate the functioning of Air India solely from business point of view, as has been done by the NITI Aayog."

In its revised draft report on the airline's proposed disinvestment, the panel noted that the TAP and financial restructuring plan (FRP) was for a period of 10 years from 2012 to 2022 and Air India has shown "an overall improvement in various parameters and every indication is that it is coming out of the red".

"At the end of TAP period, the government may evaluate the financial and performance status of Air India and take a decision accordingly," the panel said.

The parliamentary committee, after hearing the views of all stakeholders, "strongly feels that it will not be appropriate at this stage to disinvest when Air India has started earning profit from its operations."

It also said that as some of its subsidiaries Air India Air Transport Services Limited (AIATSL), Air India SATS Airport Services Private Limited (AISATS), Alliance Air and Air India Express were making profits, these units should "not be disinvested."

Strongly recommending that the airline's debt "should be written off by the government", the revised draft report said, "Air India should be given a chance for at least five years to revive themselves". The tenure of five years indicates the end of the TAP and FRP period in 2022.

It said the airline's debt was "due to policy directions of the Ministry of Civil Aviation. Air India may be permitted to function as a government PSU with less government control."

The Committee also expressed apprehension that Air India's strategic disinvestment "would result in job loss of many people" and asked the government to "make an assessment" of the job loss before deciding on stake sale.

"If the disinvestment of Air India and its subsidiaries is inevitable, the Committee emphatically recommends that the interests of employees should be protected," the revised draft report said.

It asked the Ministries of Finance and Civil Aviation to "develop a strategic package to protect the rights and interests of officers and staff of Air India and its subsidiaries in respect of their pension, gratuity and VRS and also the wages of contractual workers engaged by government from time to time in case the disinvestment of Air India is inevitable."

The panel found merit in the views of some of its members that if Air India is withdrawn from the aviation scene, "private airlines would indulge in gouging and that (will not be) in the interest of the consumers."

Air India has a total debt of about Rs 48,877 crore at the end of March 2017, of which about Rs 17,360 crore were aircraft loans and Rs 31,517 crores were working capital loans.

The airline is expected to report a net loss of Rs 3,579 crore for 2017-18, as per budget estimates projected for 2017 -18 from a provisional net loss of Rs 3,643 crore for 2016-17.

The airline is projected to increase its operating profit to Rs 531 crore (BE projected) for 2017-18 from a provisional operating profit of Rs 215 crore for 2016-17, as per latest figures tabled in Parliament.

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Agencies
July 29,2020

New Delhi, Jul 29: Coronavirus infections in India continue to mount as the country's total case tally crossed the 15-lakh mark.

India added 48,513 fresh cases in 24 hours, taking the total tally to over 15.3 lakh, according to the Health Ministry’s 8 a.m. update on July 29.

Key Figures

Total number of confirmed coronavirus cases: 15,31,669
Active cases: 5,09,447
Cured/discharged/migrated: 9,88,029
Deaths: 34,193
Number of fresh cases in 24 hours: 48,513
One-day recoveries: 35,175
One-day deaths: 768
India’s coronavirus epidemic is growing at the fastest pace in the world, increasing 20% over the last week, according to Bloomberg’s Coronavirus Tracker. Maharashtra, Tamil Nadu, Andhra Pradesh and Karnataka are among the states where the maximum number of daily cares are being reported.

Fresh cases continued to come in at a heightened pace, hovering just below 50,000 for the last six days.

Moderna Inc.’s vaccine candidate against Covid-19 protected against the virus in a trial that inoculated 16 monkeys, an encouraging step on the path to a defense for humans against the pandemic. Pfizer Inc., however, is preparing for the novel coronavirus to endure, leading to long-term demand for a seasonal shot to protect against Covid-19.

“There is a likely scenario that either the vaccine’s immunity will not be lasting forever,” said Chief Executive Officer Albert Bourla in an interview Tuesday, “or that the virus will mutate, or that the virus will find ways to come back again and again.”

Even as the transmission rate of Covid-19 remains high in India, the pace of recovery has risen too. On Wednesday, India reported its third day of over 35,000 recoveries.

Global Update

Flare-ups in virus cases from Hong Kong to Europe are proving difficult for policy makers to wrangle. The U.S. neared 150,000 deaths from Covid-19, even as daily infections slowed in some hard-hit states. China reported 101 new cases, up from 68 a day earlier, with 98 of the total from local infections, mostly in Xinjiang.

Philippine health authorities warned that hospitals and infirmaries risk getting overwhelmed.

Globally, confirmed Covid-19 cases have topped 16.6 million with over 658,000 dead.

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Agencies
February 29,2020

New Delhi, Feb 29: Former RBI governor Raghuram Rajan has said slowdown in growth is due to the current government focussing more on meeting its political and social agenda rather than paying attention to the economy.

India can still reverse its slowing economic growth by paying attention to key issues, he said. "It's a sad story, I think most recently, it is politics," Rajan said in response to a question on what was stopping India's growth which remains below potential.

In an interview to Bloomberg TV, Rajan said unfortunately the current government after a massive election win has "focussed more on fulfilling its political and social agenda rather than paying attention to the economic growth".

"Unfortunately, this drift has continued a pace of slowing growth, which was precipitated initially by some actions the government took such as the demonetisation and a poorly rolled out Goods and Services Tax (GST) reform," Rajan said.

India's GDP growth hit nearly 7-year low of 4.7 per cent in the December quarter, as per official data released on Friday.

The GDP growth for the quarter is the lowest since January-March of 2012-13.

In the interview, which was telecast before the official numbers were released, Rajan said India has not paid sufficient attention to cleaning up the financial sector and unfortunately, that is leading to the slowing growth.

"These are things that they can change if attention is paid to them and appropriate actions are taken," Rajan, Professor of Finance at University of Chicago Booth School of Business, said.

On being asked about the spread of the coronavirus globally and its impact, he said there will certainly be some legacy issues in terms of business rethinking in the global supply chain.

"If it is disrupted anywhere, the entire supply chain is held ransom and companies are going to start rethinking that should we actually have these really spread out global supply chain or to bring them back closer home and how much diversification should we have. Should we have multiple production sites across the world rather than have it focussed primarily in Asia," he said.

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Agencies
May 17,2020

Mumbai, May 17: Much on expected lines, Maharashtra, on Sunday, extended the coronavirus lockdown till May 31, in order to control the spread of the virus, under the Epidemic Diseases Act, 1897, the state government said in a statement.

On Sunday afternoon, Chief Secretary Ajoy Mehta, in a notification said: "It is further directed that all earlier orders shall be aligned with this order and remain in force up to and inclusive of May 31, 2020. The calibrated phase-wise relaxation or lifting of lockdown orders will be notified in due course."

"Lockdown 3.0 ends today. Lockdown 4.0 will come into effect tomorrow and will be valid till May 31. There will be some relaxations in the fourth phase," he said.

"The green and orange zones will get more relaxations, in terms of starting more services. As of now only essential services are operational, he said.

Maharashtra has recorded 30,706 COVID-19 cases of which 22,479 are active. The death toll is 1135, while 7,088 patients have been discharged after recovery.

In exercise of the powers conferred under Section 2 of the Epidemic Diseases Act, 1898 and the powers, conferred under the Disaster Management Act, 2005, the Chairperson, State Executive Committee, issued direction to extend the lockdown till 31 May 2020 for containment of COVID-19 epidemic in the State and all Departments of Government of Maharashtra shall strictly implement the guidelines issued earlier form time to time, according to the statement.

Over the last two days,  Maharashtra Chief Minister Uddhav Thackeray held a series of meetings with his ministerial colleagues, senior leaders including NCP supremo Sharad Pawar and top officials. 

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