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PAC slams AI for debt- fueled purchases

06:05 AM Jun 02, 2019 |

New Delhi: Questioning the timing of merger and fleet acquisition when Air India was under heavy debt, Parliaments 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.

AI officials told the PAC that it was their idea to merge the two carriers as the alt39 open skyalt39 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.

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” They have been asked to submit all documents on merger and fleet acquisition from the conceptual stage onwards to the committee,” a member said.

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The officials were grilled on their plan to acquire 50 aircraft which quickly got the governments nod recently while their earlier plan to buy 18 additional planes could not materialise

materialise even after six years.

The officials are learnt to have told the Committee

that the proposal to purchase 18 aircraft was a short- term move whereas the proposal to induct 50 planes was a long- term plan which had the approval of the board.

” They said the file went from bottom to top and got cleared,” a committee member said. AI officials refuted suggestions that they had shut down profitable routes and assured Committee to provide it with details to support their claim. Officials of the Indian Airlines were grilled by PAC members for their alt145 pooralt39passenger service. PTI

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