Air India appoints new CMD amidst troubleshooting

Steering through disinvestment

Aviation

December 11, 2017

/ By / Kolkata



Pradeep Singh Kharola will function as the new Air India CMD

Pradeep Singh Kharola will function as the new Air India CMD

Senior IAS officer Pradeep Singh Kharola assumed charge as the chairman and managing director (CMD) of the debt-ridden national carrier, Air India, at a time when the government has started the process for its strategic disinvestment.

Kharola took over from Rajiv Bansal, who assumed office in August and was appointed for a three-month tenure. Bansal’s appointment came at a time when Air India started undergoing the disinvestment procedure and ex-CMD Ashwani Lohani had been moved to the Railway Board as the chairman.

However, on December 11, it was announced that Karnataka cadre officer, Pradeep Singh Kharola would be steering the national carrier at a time when the government finally started the strategic disinvestment process of Air India, taking over from Bansal. Kharola was the managing director of Bangalore Metro Rail Corporation Ltd since February 2015. A PhD in public transport systems from Indian Institutes of Technology (IIT)-Delhi (capital of India), he also headed the Karnataka Urban Infrastructure Development and Finance Corporation Ltd.

On November 24, it was reported by Press Trust of India (PTI) that Bansal was given a three-month extension as CMD of Air India for three months and that an order in this regard was issued.

Air India had total debt of about INR 489 bn  (USD 7.5 bn) at the end of March 2017, of which about INR 174 bn (USD 2.68 bn) were aircraft loans and INR 315 bn (USD 4.85 bn) were working capital loans.

In the meanwhile, a parliamentary panel on Monday witnessed contrasting opinions among ruling and opposition members regarding Air India’s privatisation and disinvestment. All the trade unions strongly opposed the decision to privatise Air India, while some members wanted to know why profitable ventures like Air India Express are being sold.

Reportedly, there were also differences of opinion among the members, with some supporting and others opposing the disinvestment of Air India. According to a PTI report, even though BJP (ruling party) members were in support of the Air India disinvestment decision, party member Shatrughan Sinha voiced his opposition to the plan.

The question now looming is whether the government-run Air India will be divided into two enterprises – namely Air India and Air India Express, before sale.

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