Summers in Florida are long, hot and humid. I get a little light headed if I am under the sun for any length of time. Because of this, I do not play Croquet during the summer and limit my golf to 9 holes. This results in boredom and while I do read books, newspapers (both U.S. and Indian) and magazines, I still have a lot of time on my hands. I am trying to find some activity which will keep me occupied. One of them is Jig Saw Puzzles and The Activities Department has opened its library to me and so, I have been able to use up some of my spare time.
The latest news about my alma mater is alarming. It has not paid Oil Companies in India for over 6 months and owes about Rs. 5,000 crores. This has resulted in it being shut out from refueling at 6 domestic airports. Newspaper reports also indicate that the Management has sent an SOS to Government requesting an immediate infusion of Rs. 2,500 crores to pay half the same owed to the Oil Companies.
What happened to the so-called “turnaround specialist” that the Government appointed to head the airline? So far, he has nothing to show for this title. Air-India’s debt is now Rs. 58,000 crores and mounting.
This is not the first time, nor will it be the last time that AI has reached this very critical stage of insufficient funds for day to day activities.
And yet, the Management has the audacity to state that but for the “inherited debt”, the airline would be making operating profits. Let’s examine at this very bold statement very carefully.
The first question that comes to my mind is has the airline paid back part of this debt. From all indications, the answer is a resounding “NO”. The debt has been increasing each year and the cumulative losses rising at an alarming rate.
The next question is, have all bills been accounted for and paid. A Company can only show an operating profit if its gross revenues exceed gross expenses. We have seen that fuel bills are not being paid. This major item of expenditure has not been shown in the gross expenses.
What about the non payment of salary dues to staff. I understand that high category employees - pilots, aircraft maintenance engineers and cabin crew are being paid 25% less every month for more than five years now. The arrears amount is quite a significant sum.
In addition, we have the case of 19 aircraft sitting idle dues to lack of spares. No monies have been spent to get these aircraft in the air and in response to another SOS from the Management, Government has released another Rs. 350 crores to remedy the situation.
If we add all of this “debts” to the total expenses, there is a massive operating loss.
And this so-called “turnaround” expert has the temerity to state that but for the debt, the airline is making operating profits. Who is the CMD trying to hoodwink?
If I may be allowed to go further and presume that Government will accede to the SOS and give Rs, 2,500 crores to AI, what about the balance due to the Oil Companies? It is another Rs. 2,500 and will the Management attempt to push it under the carpet till the Oil Companies once again demand payment? What will happen - another SOS to the Government!!!
Why take half measures. Let the airline ask for and let Government pay off the entire amount due to the Oil Companies and the airline starts from a clean slate. Here I am assuming it has funds to pay the fuel bills which will become due in the future.
In my last Post, I had mentioned that Shiv Kapuria had been hospitalized after having suffered a stroke. I am glad to report that he is feeling better and in fact, called me last week. He is still very weak and will need some time to recover. Meanwhile, we are now exchanging e-mails which is a very good sign.
On the Political side of my world, our President seems to be getting into more and more diplomatic messes. During his meeting with the Pakistan Prime Minister, he stated that Mr. Modi had requested him to mediate in the Kashmir dispute. Just proves that he is delusional. Then, he gets into a diplomatic quarrel with Denmark by wanting to buy Greenland and calling the Denmark PM’s response as being “nasty”.
He is now in France for the G7 summit and the news media is predicting some “fireworks”. Has anyone any suggestion in reining him in?
Our oldest grandson has gone to college. He has entered Lehigh University which is the alma mater of both his father and his Chacha. By the way, the latter (Sarat) is on the Board of Governors of this University and has been a Trustee for over 15 years. Soon, the other children will be headed in a similar direction and I hope and pray that I will still be around to attend the graduation ceremonies of all of them.
I have just made reservations to fly to New York in October. This is our semi-annual visit to be with the children; the first one being in June. One of the attractions of the forthcoming trip is the annual 3G dinner which is a celebration of the birthdays of our older granddaughter, Aanya (8th Oct), Manju (12th Oct) and our older son, Akhil (19th Oct). Really looking forward to spending some quality time with the family.
