Air India Gets Cash Boost Of $215 Million To Pay Salaries, Dues

In an effort to revive the debt-ridden Air India, the government pumped in Rs. 1,200 crore ($215 million) as equity on Monday, to be put to use in paying employee salaries and vendor dues.

The ailing national carrier will use Rs. 250 crore (over $44 million) -- of which Rs. 150 crore ($27 million) will be drawn from equity infusion and the rest from ticket sales -- to pay salaries to all its employees, except 400 pilots from erstwhile Air India, who have been on strike since May 7. The rest will be used partially to clear airport, oil and tax dues, the Times of India reported, quoting a senior official. With the latest cash boost, Air India has Rs. 1,867 crore (over $335 million) as equity this fiscal year.

The plan to deny pending salaries is bound to stir protest among members of the striking Indian Pilots' Guild (IPG), who were flying until the time they went on strike demanding assured career progression.

Responding to the Dharmadhikari Committee recommendations announced Friday to streamline pay scale and carrier progression of the employees of Air India and Indian Airlines, the IPG said it highlights the prejudice and bias that airline management harbors against erstwhile Air India employees.

It appears that the report is tailor-made to suit the interests of the employees of erstwhile Indian Airlines. It reinforces the bias and prejudice that the management harbors towards the employees of erstwhile Air India vis-a-vis the employees of erstwhile Indian Airlines, the IPG said in a statement, adding that it didn't have a copy of the full text of the report, and that its observations are based on reports that have appeared in the media.

Indian Airlines pilots are promoted to the higher grade in six years, whereas the same promotion for Air India pilots takes up to 10 years. Therefore, an Indian Airlines pilot with less years of service will become senior to an Air India pilot with more years of service, the statement said.

Though the full report has not yet been made public, erstwhile AI pilots fear a 30 percent cut in pay, as the aviation ministry says AI pilots are among the highest paid in the world. The 1,600 AI pilots are paid Rs. 800 crore (about $144 million) every year. An AI commander draws Rs. 7 lakh ($12,000) per month, which is 10-15 percent more than what pilots get paid in private airlines. They are also entitled to perks including free travel with the family across the country and to unlimited international destinations.