Air India to adopt cost cutting measures: Patel
21 July 2008
Mumbai: Flag carrier, Air India, is set to follow in the slipstream of other Indian carriers by adopting cost reducing measures, according to civil aviation minister, Praful Patel. Already burdened with heavy losses, the high cost of fuel and falling passenger demand is now forcing the state-owned carrier to cut down on further losses.
These measures will include reducing the number of flights. ''Some harsh steps are required by Air India. They have to cut down loss-making routes. They could also reduce the expenditures,'' Patel informed the media.
The minister hastened to add, ''there are no directions from his ministry on this issue''. His clarification maybe seen in the light of the fact that in a state-owned entity a movement to revoke decisions is launched almost as soon as they are taken.
Matters would be especially sensitive in what may well become an election year.
On the issue of a bail-out package for the airline industry in the country, the civil aviation minister said that the Government does not give any subsidy or money to any airline. ''Airlines don't get any subsidy or money from the government. They bear the expenses only through their income. As long as these airlines can do so, fine, but if they can't, then they will have to cut down the routes,'' he said.
The national carriers' net loss for 2007-08 is being pegged at Rs2,144 crore.