The CPI-M today demanded a CBI inquiry into the decisions of the Civil Aviation Ministry since 2004, saying the policies had converted the state-owned airlines into loss-making, debt ridden units while benefiting aircraft manufacturers and foreign airlines.
The party also demanded a probe into the roles of the former Civil Aviation Minister and the former Finance Minister who had given a green signal for the purchase of 111 aircraft by Air India.
"The CPI-M demands that this whole matter be investigated by the CBI. The role of the former Minister of Civil Aviation and the former Finance Minister, who chaired the Empowered Group of Ministers that cleared the proposal for acquisition of the aircraft, should be probed," the CPI-M) Politburo said in a statement.
"It is evident that the policy decisions taken by the MoCA from 2004 onwards converted the state-owned airlines- AI and IA- which were making profits till 2005, into a loss making debt-ridden entity.
"Moreover, major aircraft manufacturers Boeing and Airbus, as well as major foreign airlines like Emirates have benefited from the Civil Aviation Ministry''s decisions at the cost of the national carrier," the party said.
Also, the CAG report on Civil Aviation in India clearly indicts the Civil Aviation Ministry for the state of affairs of Air India, whose accumulated losses since 2006 have crossed Rs 20,000 crore and its current debt burden amounts to over Rs 46,000 crore, the statement said.
The CPI-M said the Comptroller and Auditor General (CAG) has held the Ministry responsible for increasing the number of Boeing aircraft to be acquired by erstwhile Air India from 28 (proposed earlier) to 68 in 2004 in a hasty manner.
"The purchase agreement was signed with Boeing in December 2005 for Rs 33,197 crore. This arbitrary expansion of the acquisition plan, financed by loans, has been a significant factor behind the sharp increase in AI's debt burden," it said.
Holding Civil Aviation Ministry responsible for pushing erstwhile Indian Airlines for acquisition of 43 aircraft from Airbus for Rs 8,399 crore in February 2006 with undue haste, it said the large acquisition was clearly driven by influence of the MoCA, ignoring the concerns of several officials on the financial viability of such large-scale acquisitions.
Had the merger taken place before the separate acquisition of aircraft, a common acquisition process would have saved significant revenues for the airline, it said.
The policy on bilateral entitlements for international operations was substantially liberalised from 2004-05 onwards, the CPI-M said, adding it benefited big international airlines like Emirates to access the Indian market without any reciprocal benefit to AI.
The CPI-M said the CAG report confirms the findings of Parliamentary Committee on Public Undertakings (CoPU) which noted in its March 2010 report that "the merger of Indian Airlines and Air India was an ill-conceived and erroneous decision...
CoPU also called for a review of route and slot allocations to airlines in the backdrop of reports "about the public carriers being disadvantaged by the allocation of prime commercial routes to private airlines such as Jet Airways, Kingfisher Airlines and Emirates and also the allocation of time-slots on common routes in such a way that the private carriers would get the bulk of passengers on such routes," the party said in the statement.
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