The government of India has appointed Kumar Mangalam Birla, chairman of the Aditya Birla Group, and ITC chairman Y C Deveshwar as non-official independent directors for Air India. Deveshwar had earlier headed erstwhile Air India from 1991-94, when the airline was still in the black and profits had shored up under him. Cleared by the PM-headed appointments committee of the cabinet, the two businessmen will be on AI board for three years unless the next government in 2019 decides otherwise. The move comes as AI is now struggling to survive after NDA’s failed divestment bid.
Earlier also, governments have also tried to pick top business minds to revive AI. UPA had even approached Ratan Tata for heading a special group on AI, which did not materialise. Currently, AI is facing a severe cash crunch due to which it has started receiving notices from both lenders and aircraft leasers. While the airline had sought £212.1 million equity infusion to meet expenses, the administration is looking at £98 million infusion. The airline has to do annual NCD debt servicing of over £50 million next month and it has made it clear that without the requisite fund infusion, it may default on payment. When asked about the shortfall, aviation secretary R N Choubey said, “government is fully committed to providing necessary support to AI. The airline will not be allowed to default.” AI may reschedule certain payments that have to be made in coming days.
Jet Airways in talks to cut salary
Jet Airways said it was in talks with employees and key stakeholders to implement cost reduction measures such as cuts in salaries of staff. The airline said that the talks with the employees is in line with its stated focus of creating a "healthier and a more resilient business". The airline in a statement said that the company has been implementing several measures to help it reduce cost as well as realise higher revenues. "Some of these measures include sales and distribution, payroll and maintenance, among many others. As part of this approach, the airline management is in dialogue with key stakeholders to enlist their full support and cooperation for realising necessary savings across all parts of the business." The company said that it is committed to create a growth-oriented and sustainable future. Currently, the airline is in the process of adding 225 Boeing 737 MAX aircraft which will be inducted into its fleet over the next decade, of which 11 are slated to join within this financial year.
Mistry moves NCLAT against his removal from Tata Sons
Cyrus Mistry who was removed as chairman of Tata Sons has approached the National Company Law Appellate Tribunal against the order of NCLT dismissing his plea challenging his removal as chairman of the company. A petition was filed before the appellate tribunal against the July 9 order of the Mumbai bench of the National Company Law Tribunal (NCLT). Under the Companies Act, an order of NCLT can be challenged before the National Company Law Appellate Tribunal (NCLAT). Mistry was ousted from the position in October 2016. He had taken over as the chairman in 2012 after Ratan Tata announced his retirement. Two months after his removal, Mistry’s family-run firms Cyrus Investments Pvt Ltd and Sterling Investments Corp approached the NCLT as minority shareholders, against Tata Sons, Ratan Tata, and some other board members.