The Air India Board at its meeting held in Mumbai today, accepted the recommendation of the Committee headed by Mr Anup Srivastava, Director-Personnel, to review Productivity Linked Incentive (PLI) paid to employees. The cut, applicable to all officers, including top management personnel, in various management disciplines, will range from 25 per cent for those getting PLI of Rs.10,000 or less per month and 50 per cent for those receiving PLI or flying related allowances of Rs.2.00 lakhs or more per month. The cut for those receiving PLI of Rs 10001 to Rs 25000, Rs 25001 to Rs 50000 and Rs 50001 to Rs 2.00 lakhs will be 35 %, 40% and 45% respectively. The cut will be effective from PLI payable in August 2009 onwards. The number of employees covered by today's decision will be over 7,000. Air India has taken another step towards reducing its costs by cutting incentive payments to management-level employees. Kingfisher airlines is another airlines in India may try cost cuttings throgh various means. The cut applies to the carrier's "productivity-linked incentives" paid to employees, says Air India.

Air India expects 7,000 employees to be affected. "The cut, applicable to all officers, including top management personnel, in various management disciplines, will range from 25% for those getting PLI of 10,000 Indian rupees ($208) or less per month, and 50% for those receiving PLI or flying related allowances of 200,000 Indian rupees or more per month." Employees with PLIs between 10,000 and 200,000 Indian rupees are subject to a graduated scale of payment cuts. Air India made a loss of around 50 billion Indian rupees for the year to 31 March. It has been losing money for years, and has asked the government for an equity infusion of 12.31 billion Indian rupees and a soft loan of 27.5 billion Indian rupees that will be repaid over 15 years. The government, in turn, has asked it to come up with a cost-cutting and restructuring programme that will help it to return to profitability.

India's civil aviation ministry will shortly seek cabinet approval to infuse equity into ailing state-owned carrier Air India. The civil aviation minister Praful Patel told reporters after in New Delhi that the aim is to reduce Air India's high debt levels, according to Indian media reports. A time frame for the move was not specified. Air India made a loss of around 50 billion Indian rupees ($1 billion) for the year to 31 March, Patel said earlier this year. It has been losing money for years, and has asked the government for an equity infusion of 12.31 billion Indian rupees and a soft loan of 27.5 billion Indian rupees that will be repaid over 15 years. The government, in turn, has asked it to come up with a cost-cutting and restructuring programme that will help it to return to profitability.