Airlines responsible for their financial performance; government can’t interfere in day-to-day operations
By Manoj Rammohan
NEW DELHI: Efficient operations and financial performance are individual responsibilities of carriers, and the government cannot interfere in their day-to-day operations, Civil Aviation Minister Suresh Prabhu said amid Jet Airways crisis and turbulent times of the domestic airlines industry.
In view of intense competition, rising costs, shortage of pilots and grounding of planes hurting many domestic carriers, the minister also said the government has been constantly responding to industry conditions and cited measures taken, including reduction in central excise duty on jet fuel to 11 per cent from 14 per cent.
Cash-strapped Jet Airways has been forced to ground planes, cancel flights and delay payments, including salaries to pilots, while Air India continues to grapple with financial woes. On March 25, the board of ailing Jet Airways cleared a debt resolution plan whereby lenders would take control of the carrier.
Against this backdrop, Prabhu said that each airline prepares its own business plan on the basis of its own market assessment and financial resources.
“Based on its business plan, the efficient operations and financial performance are the responsibilities of each individual airline and its shareholders.
“However, the government has constantly been responding to industry conditions and undertaking specific measures to facilitate and enable growth of the sector,” he told PTI.
In written replies to PTI queries, Prabhu said the airline industry is a dynamic industry which requires continuous adjustment according to global and domestic needs.
“It is our endeavour to support the industry, however, as stated we cannot interfere in day to-day operations of the airlines,” he noted.
About Air India, the minister said a revival plan has been prepared for the national carrier that focuses on various aspects, including a comprehensive financial package and transferring non-core debt and assets to a special purpose vehicle.
The revival plan also focuses on higher level of operational efficiency by strengthening management and implementing best practice business processes and robust organisational and governance reforms, he added.
Debt-laden Air India is staying afloat on taxpayers’ money and an effort for its strategic disinvestment did not take off in May 2018.
Source: Press Trust of India