The Air India Pilots Union is requesting urgent government assistance in light of the coronavirus outbreak. Air India pilots claim that the carrier hasn’t paid full salaries since December and the government has not provided funding. The pilots also emphasized the risk that crews take when operating what are effectively rescue flights from all over the world.
A perennial problem for Air India
This is not the first time Air India has reneged on financial commitments. The airline has a well-documented history of financial struggles, which include failures to pay its staff on time and to pay for essential services like refuelling and repairs. The reason the airline continues to survive, however, is because of the government’s near-constant support.
The government has pumped over $3.24bn into the national carrier since 2014, while it lost over $2.8bn during the same time period. All of this poised to change with Air India’s privatization. The government has shifted from propping up the airline to preparing it for sale. Last year, the government only provided $58mn for operations but provided hundreds of million to wipe the airline’s debt.
One of the complaints highlighted by the Union is that the government has provided no funds to the airline in the current financial year. For an airline so heavily reliant on this aid, the effects have been widespread. The Union has said pilots have seen their salaries delayed for over a year, with January’s salaries still pending. Flight crews are also at high risk of contracting the virus from passengers flying from hotspots, a fact highlighted by the Union. They have urged the government to provide aid and help Air India meet its financial obligations.
The situation continues to worsen
With the coronavirus now spreading to more countries, the aviation industry has taken a huge hit. Air India has cancelled all its Europe-bound flights from Mumbai, Ahemdabad, and Delhi and cuts dozens of routes to the Middle East. The flight cancellations come in addition to Air India’s cuts to affected cities such as Seoul, Milan, Hong Kong, and Shanghai.
Air India does continue to operate flights to many affected regions to fulfill its obligation as a flag carrier. This means bringing back stranded Indians from all over the world. India has also issued sweeping travel restrictions, meaning demand is set to disappear altogether from many parts of the world.
With Air India planning for privatization, the government will be less incentivized to bail out the airline than in the past. However, we could see the virus delay the divestment process and the government forced to provide billions in aid. The Pilots Union’s complaints seem to well-founded and exemplify the tough time the industry faces, with flight crew at the frontline. In all probability, the government will provide Air India will emergency funding so as to continue operations. We could also see a broader aid package coming in the coming months.
What are your thoughts on Air India’s struggle? Should the government provide aid to the industry?