Haj Subsidy Canceled, Funds to be used for empowering Minority Women

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Around 1,75,000 pilgrims to visit Haj this year from India.

On January 16th, the government decided to cancel the historical Haj subsidy. The subsidy given to Haj pilgrims can be dated back to 1932. The Port Haj Committee Act was adopted by the British to encourage the Muslims to go on a pilgrimage to Mecca in Saudi Arabia.

Over the decades, the policy was greeted by a number of changes. And in contemporary times it had turned into a matter of criticism. Though the initial discussions to do away with the Haj subsidy began with a Supreme Court order in 2012, it was only in 2017 that the Central Haj Committee decided to abolish the subsidy with start of a new year in 2018.

With the government announcing the withdrawal of the Haj subsidy, Mukhtar Abbas Naqvi, Minority Affairs Minister stated that the funds used for the subsidy will now be directed towards education. He claimed that the objective was to empower the women hailing from the minority section. It also interesting to note that the verdict to eliminate the subsidy came a day after the government permitted Muslim women over 45 years of age to perform a Haj yatra, in groups of four, without being accompanied by a male guardian.

However, regardless of the decision to cancel the subsidy, Naqvi told the media that around 1.75 lakh Muslims might be undertaking the Haj pilgrimage through the course of the year. He also added that the Saudi Arabian government is in talks with India to permit Haj pilgrims from India via ships.

Concerning the cancellation of the subsidy, makes one question the actual intention of the government. Did Air India and a Saudi airline feed on the subsidy arranged by the Centre for Muslims to fly budget to Jeddah? The truth is that the Haj subsidy was surrounded by numerous layers.

According to reports from Outlook magazine, in 2017 the pilgrims were required to pay a subsidized return airfare amount of Rs 45,000 for Air India. This advance booking was expensive as the Delhi – Jeddah return ticket was available at Rs 30,000 during the peak season. And in August, again during the peak season, Etihad provided tickets at Rs 39,846.

These figures reveal that the amount paid by the pilgrims was equivalent to or higher than the market price. Thus making the subsidy a financial excuse to keep Air India afloat.  However, Air India stated that the definite rate fluctuated between Rs 63,750 to Rs 1,63,350 based on the ports of embarkation.

Since 2012, there has been a decline in the amount of subsidy allocated. In 2016-17, the Centre released Rs.450 crore towards Haj. Reacting to this, Asaduddin Owaisi, leader of All India Majlis-e-Ittehadul Muslimeen insisted on the cancellation of the subsidies as he was convinced that they were used as an armour to benefit airline companies.

Keeping the matter of airlines aside, Congress positively reacted to Modi government’s decision and demanded the successful utilization of money towards education. And since the government also supplies subsidies for Hindu pilgrimages like Kumbh Melas and the Kailash Mansarovar yatra, the Vishva Hindu Parishad requested the allocation of funds utilised for the education of poor Hindu girls.


Source: The Wire, The Indian Express

IndiGo interested in buying stake in Air India

India’s leading airline in terms of market share, IndiGo, has expressed its interest in acquiring a stake in India’s National Air Carrier, Air India (AI) on June 29. The Gurugram based carrier IndiGo has given an unsolicited Expression of Interest (EoI) in buying a stake in the debt-ridden national carrier. This move by IndiGo comes a day after the Union Cabinet approved Air India disinvestment.

Minister of State for Civil Aviation Jayant Sinha said that the low-cost carrier’s EoI was the first formal offer for AI. He further said that a number of domestic and international carriers have expressed their interest in Air India, but none of them have approached the government formally. Air India is currently weighed down by a debt of over Rs 50,000 crore.

In a letter to the Civil Aviation Ministry, IndiGo expressed its interest in taking over the international operations of Air India and its affiliate Air India Express. If this was not available separately, the airline would be open to buy its domestic AI’s domestic operations as well, stated the letter further.

The steadily increasing debt of Air India has prompted the government to disengage itself from the national carrier. Subsequently, NITI Aayog recommended 100% disinvestment, suggesting three stake-sale options at 24%, 49% and 74%.

Before the formal approval of disinvestment came through, the Tata Group had shown a keen interest in buying a stake in Air India. This was seen as a possible homecoming for the ‘Maharaja.’

News Sources- Economic Times, Bloomberg Quint, LiveMint 

A possible home coming for Air India, our national carrier

N Chandrasekaran, chairman of one of the leading corporate houses of the country – Tata Group – has held informal talks with the government, expressing an interest in buying India’s national carrier – Air India – in partnership with Singapore airlines, according to Financial Express.

Times of India reported that the Tata Group is interested in buying a controlling stake in Air India with 51% equity. Recently, finance minister Arun Jaitley and civil aviation minister Ashok Gajapati have both spoken openly about this. Though the government is keen on retaining Air India as a domestic air lines, it is happy about the proposal.

The heavily debt-laden carrier has had no profit for the past ten years. The main reason behind Air India’s loss is the intense competition from the more efficient and cheaper private airlines. Presently Air India is reeling under a debt of rupees fifty thousand crore, of which rupees twenty-eight thousand crore is in capital debt and rupees four thousand crore in interest burden. While the Tata Group is concerned about the huge debt, they are also considering the 14% market share commanded by the airlines. Apart from that, government has also assured Tata Group that it will bring down the debt substantially to make the air line a lucrative one.

Tata chairman Ratan Tata had said in 2013 that the group would “be happy to look” after Air India as and when privatisation happens. So, this can be a home coming for Air India, as it was launched and owned by the group since 1932 before being nationalised in 1953.

Sources: Times of India, Financial Express

Bomb threats leads to grounding of flights at the Delhi airport

Tension struck the Indira Gandhi International Airport when two of its air carriers, Air India and Jet airways had to be grounded due to unknown ‘bomb threats’ received on Tuesday. The flights were destined to fly to Kathmandu from the national capital.

The airport sources confirmed the news in a statement to The New Indian Express “We received a bomb threat at our Jet Airways security office at Indira Gandhi International Airport. It was an anonymous call targeting Air India flight AI-215 and Jet Airways flight 9W 260.”

Following the bomb threat, both flights having scheduled departure at 0115 hour and 0130 hours, respectively had to be grounded instantly. The AI flight had 121 passengers and Jet airways had 122 people including 7 cabin crew members on board.

The sources at the airport claimed that the two air crafts had been taken to the isolation bay, where a complex research was carried out by the Bomb Disposal Squad (BDS) while checking the baggage and check-in luggage of the travelers.

This is consecutively the second time of grounding since Saturday. It was the same flight of Jet airways which had to be delayed by six hours due to grounding. A similar bomb threat call was witnessed, which later turned out to be deceptive.

Source: huffingtonpost.in 

Air India to sell nine of its Dreamliners

Indian Government owned Air India has put nine of its 21 Dreamliners (B787-800) on sale in a bid to raise over Rs 7,000 crore. This has been carried out to have funds for buying new aircraft and for repaying a loan taken for purchasing these Boeing 787-800s last year.

Air India would also lease back these nine Dreamliners under an operating lease for a period of up to 12 years with a three-year extension option. According to this, Air India would sell these planes to the lessor and immediately lease them back under an operating lease for a period of up to 12 years with an option to extend by three more years at a mutually negotiated price, the airline said in an Invitation of Offers document.

The carrier came out with Invitation of Offers from domestic and overseas institutions and banks earlier this week, to raise up to $110 million for part financing the advance payment of these planes.

The airline plans to induct a new, higher variant of the aircraft which has more seating capacity for its ultra-long-haul routes such as the US and Canada. The current Dreamliner (B787-800) has 256 seats, of which 18 are in business class and remaining 238 in economy class.

Source- profit.ndtv.com

Air India brings free tickets for frequent fliers

With the arrival of the festive season, Air India is an attempt to woo its customers with freebies, offered a conditional free ticket to its frequent fliers. Air India is owned by the Indian Government, and the free ticket will entail fliers on the domestic sector for a limited period.

This is under the “Web Loyalty Bonus” scheme, available for bookings made through the airline’s website between October 15 and December 31, 2015. Any passenger buying business class tickets for travel on six domestic sectors will be get one free return ticket for the same class on any domestic sector operated by Air India or its regional subsidiary Alliance Air, a release said.

There is a similar case for economy class tickets also. The passengers buying economy class tickets for travel on 10 domestic sectors will get one free return ticket for the same class on any domestic sector of Air India and or Alliance Air, according to the release.

This will be done by absorbing the basic fare and fuel surcharge on the reward tickets, and the ticket will be valid for 6 months from the date of issuance.

Source- profit.ndtv

Air India set to launch world’s longest non-stop flight

Air India has announced the launch of a direct flight course between New Delhi and San Francisco in December. If this flight goes operational, this specific route would undoubtedly stand as the world’s longest non-stop business route and will cover the distance in 16 hours.

As per the official sources the airline has already booked slots at the San Francisco terminal and preparing for a December dispatch. Initially, the Air India was considering a Bengaluru-Delhi-San Francisco flight, using a Boeing 777 air ship for the whole course. At present it will be utilizing its three Boeing 777-200LR carriers

The world’s longest direct flight is operated by Qantas, flying 8,578 miles (or around 13,730km) between Dallas-Forth Worth in the U.S. also, Sydney, Australia.

On similar lines, Emirates is also planning to launch flight connecting Dubai and Panama City in February 2016. However, a portion of the in-flight time will be allotted to seek diversions away from Iraq and Syria.

Presently, Air India deploys non-stop flights to Chicago and New York (from New Delhi) and Newark (from Mumbai). The Mumbai-Newark flight, with an in-flight time of 16 hours, is Air India’s longest flight from India.

Source- Business Standard