New Delhi:
Air India CMD Arvind Jadhav and his team are going to make a presentation on the plan for financial restructuring of the national carrier before the board and independent directors on Sunday. Civil Aviation Minister Praful Patel is also likely to attend the meeting.
It is touted as the new turnaround plan that will focus on other things about restructuring the company's debt and streamlining its expenses.
To qualify for the second round of equity infusion of 1200 crore from the government this year , the airline must show improved financial health.
Last year, it received 800 crore from the government. The management will have to get the Unions on board before they are able to implement the new turnaround plan.
One aspect of the turnaround plan could also include renegotiating wage agreements with Unions.
In the past, the Unions have openly opposed bits of the turnaround plan.
The financial book of Air India has not shown prospects for quiet sometime now. Till 2009, Air India reported cumulative losses of Rs 8,461 crore , the estimated loss for the year 2010 is expected to be of Rs 5,400 crore . Air India has an outstanding debt of Rs17,000 crore and runs on a monthly cash deficit of Rs 400 crore.
With not much in hand to show from the past year, convincing the board with a turnaround plan is going to be nothing short of an acid test for Arvind Jadhav and his team.
However, it will be interesting to see if their plan of restructuring is able to fly high or it remains grounded.