Indian Commercial Pilots’ Association blames management for mounting losses; demands investigation into withdrawal of profitable routes and plans to acquire over 100 new aircraft
New Delhi: The Indian Commercial Pilots' Association (ICPA), which is spearheading the protest strike launched by pilots of Air India last night, today asked the prime minister to order a probe by the Central Bureau of Investigation (CBI) into the mismanagement of the airline that has caused mounting losses, and to take steps to restore it to its past glory.
In a letter to Dr Manmohan Singh, the association said, "The government of India has all the machinery and tools to investigate all the shortcomings of this management and hold them accountable. We, the ICPA, now demand a CBI inquiry or any appropriate body to inquire into the scams of the airline."
The letter signed by Rishabh Kapur, general secretary, ICPA, has demanded a probe into the cancellation and withdrawal of profitable routes and bilateral "giving away" to either private or foreign carriers, and the orders for acquisition of 111 new planes between the erstwhile Indian Airlines and Air India, reports PTI.
The Association has also demanded an inquiry into what it describes as "the under-utilisation of aircraft and various facilities like engine overhaul shops at Delhi and Mumbai, training and simulators at Central Training Establishment in Hyderabad, which are causing loss of revenue and extra cost to the company".
It has said that the mismanagement of Air India, once the "nation's pride", has led it "into deep waters and now it is even struggling to stay afloat".
The Association said that prior to the merger, Air India and Indian Airlines had losses of Rs455 crore and Rs280 crore, respectively, but in three years this had escalated to Rs16,000 crore, despite hiring consultancy firm Deloitte at a cost of Rs90 crore to advise on corrective measures.
ICPA labelled the management as "incompetent", saying it was "sabotaging the future of the airline". It said that "the intention of the management seems very well scripted to buy new airplanes, upgrade machinery (like SITA, SAT, IOCC) at a whopping Rs 800 crore) and kill the morale of the employees, so that they agitate, making way to sell the airline in distress".
Management declares strike illegal; says it has derecognised pilots’ association
New Delhi: Some Air India pilots launched a strike from midnight last night, resulting in the cancellation of at least 19 flights and delays to many more. The Air India management has said that the strike is illegal and it announced that it has derecognised the Indian Commercial Pilots' Association (ICPA), of which most of these pilots are members.
According to official information, eight flights from Delhi and 11 from Mumbai were cancelled this morning and many more were delayed by more than three hours due to the protest action.
"We have derecognised the ICPA, the strike is illegal and they have committed contempt of court. We are likely to move court soon," a senior official told the Press Trust of India. The ICPA offices in Delhi and Mumbai were also sealed this morning.
A clearer picture for the Indian market will emerge after the RBI’s monetary policy announcement on Tuesday
The Indian market is likely to open in the positive terrain on good cues from the global arena. However, corporate earnings announcements will sway the market as the day progresses. US markets closed at multi-year highs overnight and tracking those gains, the Asian pack is trading higher in early trade today. The SGX Nifty was up by 47 points to 5,922 over its previous close of 5,875.
Heavyweights like Dabur India, Patni Computers and Wipro are among those which are expected to announce their results today.
The local market opened flat on Tuesday, dampened by the Asian markets that were in the red on lacklustre earnings. The Sensex added 12 points to trade at 19,596 and the Nifty was a mere two points higher at 5,877. Selling in IT, metals, auto and consumer durables stocks dragged the indices further southwards till around 10.20 am. Thereafter the market was range-bound for nearly two hours and institutional sell-off pushed the indices to the day's lows. At the intra-day low, the Sensex shaved off 277 points to 19,307 and the Nifty retraced 83 points to 5,792.
A positive opening in key European markets and US futures trading in the green boosted the domestic indices in late trade, taking them into positive terrain and to the day's high. The Sensex touched 19,626, up 42 points at its intra-day high, and the Nifty was at 5,893, up 18 points. But the gains were short-lived as the markets soon turned negative and ended the day in the red for the second day in a row. The Sensex lost closed at 19,545, down 39 points, and the Nifty finished at 5,868, down six points from the previous close.
The market was volatile ahead of the expiry of the April futures and options contract and an expected interest rate hike by the Reserve Bank of India (RBI) at its monetary policy meeting next week. Earnings performance influenced stocks of companies that have announced their results. The Nifty is still stuck around the 5,800 level, as seen in the last couple of days. A decline is inevitable if it doesn't cross 5,900 soon.
Wall Street closed at multi-year highs on Tuesday boosted by earnings optimism and a rise in the consumer confidence index. Companies like Ford, Cummins, 3M and UPS reported good earnings while Coca-Cola, US Steel, Amazon.com and Under Armour disappointed investors.
In economic news, the Conference Board reported that an index of consumer confidence rose more than expected to 65.4 in April from a revised 63.8 in March. The report also revealed that a higher number of consumers see the labour market improving, while fewer expect to see inflation rising, going ahead. Besides, the Federal Reserve, which is conducting a two-day policy meeting, is expected to future plans to help stabilise the economy.
The Dow jumped 115.49 points (0.93%) at 12,595.37, new three-year high. The S&P 500 added 11.99 points (0.90%) at 1,347.24, its best since June 2008, and the Nasdaq rose 21.66 points (0.77%) to settle at 2,847.54, its highest since October 2007.
Markets in Asia were boosted by overnight gains in the US, a signal that the world’s largest economy is on the road to recovery. Asian electronics giant Samsung Electronics Co gained 3% in Seoul and digital camera major Canon Inc climbed 5.4% in Tokyo. Meanwhile, the Japanese government said 90% of the country’s earthquake-stricken factories will resume production by July. Also, South Korea’s gross domestic product rose 1.4% in the March quarter from 0.5% increase in the previous quarter, the Bank of Korea said in Seoul today.
The Shanghai Composite gained 0.42%, the Hang Seng rose 0.51%, the Jakarta Composite went up by 0.33%, the KLSE Composite advanced 0.35%, the Nikkei 225 jumped 1.29%, the Straits Times climbed 0.78%, the Seoul Composite gained 0.23% and the Taiwan Weighted surged 1.17% in early trade.
Back home, the Reserve Bank of India (RBI) on Tuesday slapped a penalty of Rs 1.95 crore on 19 banks, including heavyweights SBI, HDFC Bank, ICICI Bank and Citibank, for violating norms on derivatives, an instrument used to hedge financial risks.
The fine has been imposed on the banks for selling derivative products to companies and exporters without complying with the instructions issued by the central bank from time to time.
The lenders, according to RBI, failed to carry out due diligence with regard to suitability of products and sold derivative products to companies not having risk management policies. They also failed to verify the adequacy of eligible limits before selling derivatives, it added.