AI board meets today to discuss turnaround plan

NEW DELHI: National carrier Air India will have a crucial board meeting on Wednesday in Mumbai to discuss financial performance, turnaround plan and steps taken to cut costs. The issue of wage rationalisation is also on the board's agenda. The meeting comes after the government infused additional equity of 1,200 crore into the debt-laden carrier.

"The meeting is also likely to discuss the issue of Air India Express chief operating officer Pawan Arora," an AI official said.

The airline's November 18 board meeting had recommended sacking Arora, but he has continued in his job since. In November, independent directors - Anand Mahindra, Fali Homi Major, Harshavardhan Neotia and Amit Mitra - had met T K A Nair, principal secretary to the prime minister, on the status of the national carrier, including the controversial appointments made at the top level.


The airline has issued an advertisement for a chief strategy officer in the company. The financial restructuring plan prepared by consultancy firm Deloitte Touche Tohmatsu India would also be deliberated upon at the meeting, which comes ahead of presentations the management would make before the finance ministry and the Board for Reconstruction of Public Sector Enterprises (BRPSE) in the near future.


Air India started the new year on a positive note, making operational profit of 21.66 crore in November 2010, for the first time in about four years. This is in line with the 22.6% increase in revenues at 7,250 crore that the airline has recorded over April-November 2010. Also, its net losses have decreased by 23% to 5,551 crore in 2009-10 from 7,189 crore in the previous financial year.


Air India has mounted debts of 40,000 crore and has a narrow equity base of just about 1,000 crore. It has accumulated losses of 5,500 crore.