Rajiv Bansal, Air India and privatisation

An ornamental position or a calculated move?

Aviation

September 4, 2017

/ By / Kolkata



Air India is welcoming both national and international bidders

Air India is welcoming both national and international bidders

Debt-ridden national carrier, Air India announced Rajiv Bansal as the new chairman and managing director (CMD), after he assumed office last week. Bansal took over Ashwani Lohani who was recently given charge of the Indian railways.

The additional secretary and financial adviser in the petroleum ministry, Rajiv Bansal is additionally appointed Air India’s CMD for a three-month tenure. The appointment came at a time when Air India is undergoing a privatisation procedure to save it from ‘falling-apart’. This made several industry insiders question the move and wonder if Bansal’s appointment actually holds value.

 

Rajiv Bansal, the IAS officer who stepped into Lohani's shoes

Rajiv Bansal, the IAS officer who stepped into Lohani’s shoes

A senior operational personnel of Air India was overheard saying, “I do not understand what good will come in three months that will overcome everything that is going on already. It is like a feel-good position to maintain a farce!”

Bansal himself however remains hopeful. In a letter to his employees, he stated, “I have full faith in your capabilities and experience and I am sure that we will work as a team and do everything to further strengthen the profitability of the company. We have introduced new flights to international destinations and will continue to launch new routes in the days to come. Along with extending our network, we will be inducting new aircraft to augment our fleet with state of the art aircraft like the Dreamliners and A320 Neos.”

 

The senior IAS officer also referred to 10th anniversary of the merger of Indian Airlines and stated how it marked the dawn of a new era for Air India. “I exhort you all to rededicate yourself towards turning around our beloved Air India,” Bansal said.

Auctions and disinvestment
According to reports, Air India has received a good response to an auction of its 14 properties with ten of them getting bids worth more than their reserve price.
“We have received good bids for the properties that were put up for auction today. We got bids above the reserve price for 10 out of the total 14 properties,” Rajiv Bansal told. “The proceeds from this will go towards paying our debts, although these are baby steps.”

IndiGo and Bird Group have expressed interests in the auction which concluded on August 31. Air India finished auctioning the 14 properties located in different parts of the country. The airline is now looking to divest its non-core assets. Nearly 30 properties valued above INR 5 billion will be auctioned by first week of September by MSTC Ltd, the state-run auctioneer.

Talking about FDI with relation to AI, Civil Aviation Minister, Ashok Gajapathi Raju stated, “I think Indian mindset is not inclined towards that but theoretically everything is open. Indian mindset is that this is a national carrier. Interpretations can (be done) by anyone. Theoretically, general inclination is to keep it that is more or less the thinking of everyone.”

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