The Indian government plans to limit benefits of Air India staff till privatisation happens. Going forward, it is expected that the Centre will follow the same process in case of divestment of public-sector enterprises (PSEs).
By September 15, financial bids are expected to come in for the national carrier, which has been a loss-making company for some time now. Not surprisingly, it has been on top of the list of companies for divestment this year.
There was a delay in the divestment process due to the pandemic and because potential bidders had to go through a long and time-consuming process of physically examining the assets. Additionally, delay has also resulted from the discussion of employee benefits, including a fixed number of free tickets for the employees, their spouses and children every year.
Last year, Air India employees had sent a petition to the Civil Aviation Ministry to continue medical and provident fund benefits, as well as the system of encashing leaves even post the carrier being taken over by a private owner.
The Centre, however, maintains that even though the divestment process is taking time, the process will result in the finalisation of divestment procedures to be followed in case of other firms in the future.
Meanwhile, Cairn Energy and Devas Multimedia, are demanding US$ 1.725 billion and US$ 1.2 billion from India, which they apparently won in international arbitrations. They have filed lawsuits in the US and have sought declaratory and money judgement against Air India, considering it as an alter ego of India as a country. Lawyers have been appointed to defend Air India, and this issue is not expected to hamper divestment procedures in any way.
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