CAPA rules out possibility of Air India’s return to profitability

CAPA rules out possibility of Air India’s return to profitabilityThough political pressure forced Civil Aviation Minister Ajit Singh to backtrack from his remarks that national carrier Air India should be privatized, yet many experts still believe that the government-run carrier really needs to be privatized.

Centre for Asia Pacific Aviation (CAPA), a civil aviation consultancy firm, said in its recently-published report that despite an improvement in Air India's performance it ruled out the possibility of the carrier's return to profitability.

The consultancy also predicted that the next government would have to bite the bullet and privatize the carrier.

CAPA said in its report, "Despite the fact that AI's performance has improved significantly, we rule out the possibility of AI's return to profitability. With the carrier expected to post continued losses, we expected that the next government which takes office in 2014 will finally bite the bullet."

Last week, Mr. Ajit had said that government might look at privatizing the carrier. The comment triggered harsh criticism from the BJP and other Opposition parties. While BJP alleged that the government was trying to sell public assets without taking parliament into confidence, senior CPI leader D Raja said any such move would be disastrous for the country.

The intense pressure forced Mr. Ajit to assure the Opposition that there was no plan to sell the national carrier.