AI to seek compensation from Boeing for delay in delivery

Civil Aviation Minister Ajit Singh has said a group of ministers (GoM) on Wednesday approved Air India’s move to demand compensation from US aircraft maker Boeing for a four-year delay in delivery of Boeing 787 Dreamliner planes.

The minister, however, did not disclose the compensation amount to be sought from Boeing. Singh told reporters after the GoM meeting chaired by Home Minister P Chidambaram: “The GoM considered it and now we will send it to the CCEA (Cabinet Committee on Economic Affairs). It will be taken up whenever the next CCEA meeting is held.” A meeting of the CCEA is likely to be held on Thursday.

Deposing before a parliamentary committee, then AI CMD Arvind Jadhav had said: “We have slapped a compensation claim of $ 710 million. Obviously, they have confirmed $ 145 million they will pay as compensation for the delay.” The panel report was made public in March 2010.

Meanwhile, the International Air Transport Association (IATA) has said Indian aviation sector was in huge crisis due to high costs and exorbitant taxes and urged the government to resolve this issue at the earliest. “India’s aviation is in a multi-faceted crisis. Before the aviation sector can deliver greater benefits to the Indian economy, this crisis must be resolved,” IATA director-general Tony Tyler said here.

Addressing a seminar on “Building the future of Indian aviation” organised by Confederation of Indian Industries, Tyler said the global aviation industry was watching the Indian sector with concern as out of India’s six main carriers only privately owned Indigo was in profit. “The financial situation of Kingfisher was in dire straits and state-run Air India is on government life support,” he noted.