PAC slams Air India for acquiring planes through debt

Last Updated: Sunday, January 22, 2012 - 13:22

New Delhi: Questioning the timing of merger and fleet acquisition when Air India was under heavy debt, Parliament's Public Accounts Committee has asked the airline to submit all documents related to the issue within a week.
Top officials of Air India and erstwhile Indian Airlines faced some tough questioning by the Parliamentary panel which also slammed them over complaints of poor passenger services.
The grilling was based on a recent CAG report on Civil Aviation which had said that the decision to acquire 111 planes by Air India through debt was "a recipe for disaster" and should have raised an alarm in the government.
Air India officials told the PAC that it was their idea to merge the two carriers as the 'open sky' policy had increased competition in the aviation sector.
They also said that since their fleet at that time was ageing, they had thought of acquiring new planes and believed that merger will provide them greater strength to compete in the new environment.
"They have been asked to submit all documents on merger and fleet acquisition from the conceptual stage onwards to the committee," a member said.
The officials were grilled on their plan to acquire 50 aircraft which quickly got the government's nod recently while their earlier plan to buy 18 additional planes could not materialise even after six years.


First Published: Sunday, January 22, 2012 - 13:22

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