Sunday, October 12, 2014

Pilots Allege Air India Insuring Grounded Aircraft, Airline Denies

Pilots of cash-strapped AI today alleged that the company was insuring grounded aircraft at an annual cost of USD 6 million, a charge denied by the national carrier.

The state-run airline's recognized pilots union, the Indian Commercial Pilots Association (ICPA), has sought an independent probe into these allegations and fix the accountability on individuals those responsible.

"Six Boeing 737-200 Fs, which have been out of service for more than three years, were still being insured at USD 1 million each per annum or USD 6 million, for more than the past three years. We demand an immediate, time-bound investigation by an external agency to look into this huge financial irregularity," ICPA General Secretary Shailender Singh said in a letter to Air India Chairman Rohit Nandan.

Terming the ICPA's allegations as "false, mischievous and misleading", an Air India spokesperson said five Boeing 737-200 were insured at only USD 1 million last year and USD 50,000 this year. "Since the aircraft are still under Air India's registration."

"The premium that is being paid on each of these aircraft was USD 145 last year and USD 90 this year," the spokesperson said.

It is highly regrettable that a responsible association like ICPA is making such baseless allegations which sadly reflects on their credibility and understanding of the aviation business, he added.

Referring to ICPA's another allegation regarding a contract with private logistic company Gati, the spokesman said Air India has terminated the contract with the firm due to irregularity of payments by Gati to Air India.

The case was referred to arbitration which went against the national carrier which has now appealed before the Delhi High Court on grounds that the arbitration award was defective.

The ICPA's letter was also addressed to Aviation Minister Ashok Gajapathy Raju and the Chief Vigilance Commissioner.

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