Air India Engineering Services Limited (AIESL), the maintenance, repair and overhaul (MRO) unit of Air India (AI), should be kept out of the disinvestment process of the national carrier, said Nitin Gadkari, Road Transport and Highways Minister.
“I want to urge the (Civil Aviation) Minister that the MRO, which is a subsidiary company, may be kept separately,” said Mr. Gadkari. “If, tomorrow, we take some decision related to Air India, then this company should not go to some private player and [should] remain a separate entity,” Mr. Gadkari said at AIESL’s Nagpur facility which completed the first servicing of a third party aircraft on Sunday.
The facility completed servicing SpiceJet’s Boeing 737 aircraft within five days. Civil Aviation Minister Ashok Gajapathi Raju, Air India chairman and managing director Ashwani Lohani, Maharashtra Chief Minister Devendra Fadnavis and SpiceJet chairman Ajay Singh were also present.
Mr. Gadkari, who is a part of a Group of Ministers (GoM) formed to decide the modalities of sale of AI and its subsidiaries, said AIESL was a profitable business and the government should invest in such companies.
In June, the Union Cabinet gave an in-principle nod for strategic disinvestment of AI and its subsidiaries and formed a GoM led by Finance Minister Arun Jaitley to draw the roadmap.
Mr. Gadkari said the initial share sale offer of Cochin Shipyard was subscribed 76 times on the last day of its bidding earlier this month showing “people still have faith in the public sector unit till date.”
On Mr. Gadkari’s comments, the Civil Aviation Minister said, “The discussions on Air India’s stake sale is an ongoing process and his comments are welcome. I will not divulge my views on his comments in the press.”
Loss-making entity
India’s oldest private sector MRO service provider AirWorks had already expressed interest in acquiring a stake in AIESL. AIESL had been incurring losses since its inception in 2013 when it was carved out of AI as a separate business unit. In 2016-17, AIESL’s losses rose about 17% to ₹653 crore as per provisional estimates.
AIESL CEO H.R. Jagannathan urged the State authorities to take steps to help its Nagpur facility. This included facilitating a round-the-clock servicing of aircraft as the aircraft can be transferred from the Nagpur airport to the MRO unit only during the day at present.
Mr. Singh said that India needs to build its own MRO infrastructure so that airlines do not service their planes outside the country. “We will bring more planes for servicing and maintain our engines too in the Nagpur facility,” he said.
(The correspondent was invited by Air India to visit AIESL’s MRO unit in Nagpur)
