New Delhi: Ground handling activities and maintenance and repair of all Air India aircraft would be carried out by two new subsidiaries of the national carrier when they become operational from February 1.
The operationalisation of the Air India Transport Services Limited (AITSL), which would carry out ground handling activities, and Air India Engineering Services Limited (AIESL) that would be responsible for maintenance, repair and overhaul activities, would slash Air India's aircraft to manpower ratio by more than half.
Air India would provide AIESL Rs 375 crore as capital expenditure over three years beginning now, while it would give Rs 393 crore over 12 years from this year to AITSL, airline sources said.
The proposal to hive off the engineering and ground handling departments of Air India to two wholly-owned subsidiaries was approved on April 12 last year by the Cabinet Committee on Economic Affairs as part of the airline's turnaround and financial restructuring plans.
The sources said the two companies would start operating as separate profit-making entities from February 1. They would be run by the Air India Board with the airline's CMD Rohit Nandan as the chairman of the two boards.
The two companies would not only carry out their activities for Air India but would also tap other carriers operating in India and tap the potential of nearly USD 1.5 billion aintenance, repair and overhaul business in the Asia-Pacific region.
Currently, a large number of Indian airplanes are sent to Singapore, Dubai or even Colombo for checks and repairs which would now on be done in the country.