Ahead of sell-off, Air India may offer voluntary retirement to 15,000 staffers

Earlier this month, it decided to stop non-vegetarian meals in economy class on domestic flights

LATEST NEWS   : This story was first published in Business Standard on 18/07/2017

Air India is drawing up a proposal to offer voluntary buyouts to just over a third of its 40,000 employees, a senior company official said, one of the largest such offers in India's state sector, as the carrier slashes costs ahead of a 2018 sale.

The official, who could not be named as the plans are not public, said the state-owned airline had also put fleet expansion on hold, scrapping a proposal to lease eight Boeing 787 wide-body aircraft. Air India's board approved the proposal in April but nothing further had been done.

India's flag carrier is on the block after Prime Minister Narendra Modi's cabinet last month approved plans to privatise the loss-making airline - selling part or all of the company and ending decades of state support.

Founded in the 1930s and known to generations of Indians for its Maharajah mascot, Air India has a complex fleet, too many staff relative to its peers and $8.5 billion in debt. Since 2012, New Delhi has injected $3.6 billion to keep it afloat.

An official in Modi's office said the leader, under pressure to cut spending and boost basic infrastructure like ports and roads, is in "no mood" to provide fresh monetary assistance to any loss-making public sector company.

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