Why Centre is eager to end AI pilots' strike

Although the Union government believes that drastic cost cutting, including salary reductions, are essential for Air India's revival, it is eager to see an early end to the current impasse between the pilots and the AI management.

According to top sources in the government, Prime Minister Manmohan Singh in his meeting with Civil Aviation Minister Praful Patel on Tuesday asked the ministry to take an initiative, even as the turmoil in the ailing airline deepened.

A top minister also hinted that the government may go slow in imposing the salary cut: "If payments are cut, then, of course, there will be agitation. We may have to adopt a reconciliatory approach."

To appease the pilots, Patel noted "no decisions" about incentive pay cuts had been taken and decisions will be taken "only after due consultation" with the workers.

Congress party managers told Business Standard that party president Sonia Gandhi was also worried.

She spoke to some senior party colleagues on Tuesday night to assess the situation. The Congress feels that ahead of the Maharashtra elections, the strike in the airlines, headquartered in Mumbai, might become a political tool in the hand of the opposition.

In Maharashtra, the Congress-NCP combination is already facing anti-incumbency challenges after being in power for 10 years. The ruling party doesn't want any additions to its list of political fear-factors.

But the UPA leadership is clear that the proposed cost cutting will have to be imposed to revive the ailing government aviation company.

Patel also pitched hard in support of these measures and said, "The current situation is a matter of concern and the Government of India, as the owner of the airline, is not very happy over the strike. The government has been very considerate and there has been a constant endeavour to help the airline come out of its current financial problems."

A section of the finance ministry earlier had an objection against the bailout package offered to AI. It was finally agreed that this should be linked with cost cutting measures at many levels.