March 21: Air India, the debt-ridden airline that’s on the road towards being privatized, is reportedly preparing to promote its employees with a hefty pay hike. Around 100 pilots will now be promoted with a pay hike of up to Rs 12 lakh per head.
According to an Economic Times report, these pilots, who are narrow-body and widebody pilots, will be promoted to executives at a time when the government is seeking preliminary interest memorandum (PIM) and Expression of Interest from interested buyers for the national carrier.
Some of the officials had justified the move citing lack of promotion in the operations department for the past 8 to 10 years. However, this is despite the government having already set the ball rolling for divestment of Air India stake.
The report comes a day after the government revealed that funds were released to the carrier for purchase and modification of two VVIP aircraft from the National Small Savings Fund. Prior to the release of funds, Air India had proposed to seek a short term loan of US$ 180 million from Bank of Baroda for the modification of its two Boeing 777-300 ER aircrafts used for the Special Extra Section Flights of the government.
The Union Cabinet approved the privatization of the national carrier in June last year. This was followed by the approval of Cabinet for investment of up to 49% in Air India by foreign airlines. The government is also planning to split up Air India’s various businesses before putting it up for sale. With assets worth about US$ 4.6 billion, Air India currently has six subsidiaries, of which three are making losses.