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IA proposal to purchase 43 planes deferred
Wednesday, 15 January 2003, 20:30 IST
NEW DELHI: A proposal by state-owned domestic carrier Indian Airlines (IA) to purchase 43 Airbus aircraft to refurbish its ageing fleet has been deferred by a month.
The cabinet committee on security (CCS) discussed the proposal at its meeting here Tuesday and decided to put off a decision on it by a month, official sources said.
The CCS has to approve the proposal after considering its security aspects.
Prime Minister Atal Bihari Vajpayee presided over the meeting. Deputy Prime Minister L.K. Advani, External Affairs Minister Yashwant Sinha and Finance Minister Jaswant Singh attended the meeting. Defence Minister George Fernandes did not attend the meeting as he has left on a visit to Russia. The three service chiefs, who are members of the CCS, also did not attend.
Official sources described the meeting, which lasted an hour-and-a-half, as "routine".
There had been speculation that the meeting would discuss the purchase of the Hawk advanced jet trainer (AJT) from Britain for the Indian Air Force (IAF) and Scorpene submarines from France for the Indian Navy.
"Matters discussed in the CCS are secret and top secret. If there was something to be briefed, I would have briefed you," Sinha told reporters as he emerged from the meeting.
The IA board had in April last year cleared the proposal to purchase 43 Airbus A-319, A-320 and A-321 aircraft at a cost of 
100 billion.
The move was, however, stalled due to the on-again off-again efforts last year to privatise IA. This issue has now been put on hold.
Civil Aviation Minister Shahnawaz Khan is known to have thrown his weight behind IA's proposal to purchase the Airbus's.
IA last bought an aircraft in 1993.
The airline recently added six planes to its fleet by leasing.
Many aircraft in the 55-strong IA fleet are nearly 20 years old. Its A-320 aircraft that average seven years are the youngest, while its A-300 planes are around 19 years old. IA's Boeing-737s are between 15 and 16 years old.
The average life expectancy of an aircraft is 15 to 20 years. Officials said barring the A-320, the airline would soon have to phase out 23 aircraft that are over two decades old.
IA has told the government it needs aircraft with a seating capacity of more than 200.
IA's market share is currently 51 percent while private airline Jet Airways is catching up with around 40 percent. IA's accumulated losses amount to 5.72 billion.
In 1997, a government committee had warned that IA's market share could shrink to 32 percent if the airline did not revamp its fleet and restructure its finances.
The report proposed a complete restructuring, including increasing the airline's fleet to 97.
Source: IANS
100 billion.
The move was, however, stalled due to the on-again off-again efforts last year to privatise IA. This issue has now been put on hold.
Civil Aviation Minister Shahnawaz Khan is known to have thrown his weight behind IA's proposal to purchase the Airbus's.
IA last bought an aircraft in 1993.
The airline recently added six planes to its fleet by leasing.
Many aircraft in the 55-strong IA fleet are nearly 20 years old. Its A-320 aircraft that average seven years are the youngest, while its A-300 planes are around 19 years old. IA's Boeing-737s are between 15 and 16 years old.
The average life expectancy of an aircraft is 15 to 20 years. Officials said barring the A-320, the airline would soon have to phase out 23 aircraft that are over two decades old.
IA has told the government it needs aircraft with a seating capacity of more than 200.
IA's market share is currently 51 percent while private airline Jet Airways is catching up with around 40 percent. IA's accumulated losses amount to 5.72 billion.
In 1997, a government committee had warned that IA's market share could shrink to 32 percent if the airline did not revamp its fleet and restructure its finances.
The report proposed a complete restructuring, including increasing the airline's fleet to 97.
Source: IANS