The  Committee, constituted by the Government  with Justice Dharmadhikari as Chairman to integrate, harmonise and finalise the wage structure of the employees of the Air India and Indian Airlines, which have been merged as Air India, has submitted its report to the Government. Both the companies were merged five years back, the wage integration has not taken so far, resulting in agitation and strikes, by the employees including pilots.

It is reported that the committee has recommended to reduce Performance Linked Incentives (PLI) being given in the Air-India  on the plea that it is against the DPE guidelines. Reducing the existing benefits cannot be the methods for integration by the committee. It do not motivate the workers.

Other details of the committee are yet to be known.

It is reported that Reserve Bank of India (RBI) has decided to allow private banks also to undertake the business of Central as well as State Government business. So far this was done by the Public Sector Banks and only three major private banks viz. ICICI, HDFC and Axis Banks. The present decision is taken, according to the RBI, to enhance the quality of customer service through more competition, improving customer convenience and broad basing the revenue collection. For this purpose, those private banks handling government business will have to be appointed as agents of RBI.

However, it is clear that this move is only a plan for further privatisation of the government business. The Public Sector Banks are doing a good job and they have kept the Indian economy to a certain safe from the global recession fall-out. The private banks have been putting much pressure of the government for including them also to deal with government business for some time.  This is part of the neo-liberalisation policy to weaken the PSU banks and transfer the major business to the private sector banks.

I hope that the PSU Bank employees’ unions will take up the issue seriously.

The wage negotiation in Coal India is in progress. The five-year wage agreement will be effective from 01-01-2006, since the last agreement was w.e.f. 01-01-2001.The unions have demanded for 35% hike while the management is prepared up to 25%. There are more than 5 lakh workers and it is the biggest PSU as far as the number of workers is concerned.  This week will be crucial for the discussion.

The government is on the look out to get more and more dividends from the cash-rich PSUs  to reduce its  financial deficit. These companies are having sufficient cash reserves. In 2009-10 alone, an amount of about Rs. 25,000 has been paid by the companies as dividend. But this year, 2010-11 the government is trying squeeze more amount, say about Rs. 26,000/ from these companies.

The government has got two agendas – one to get as much dividend from these  companies,second to finish the PSUs themselves si that they can be sold to the private. The PSU workers have to unitedly fight this injustice.

At last, it seems, that the Civil Aviation ministry has woken up towards the financial problems of the Air India, which was the result of the Minister’s and governments anti-PSU and pro-private policies. As a result, the company had gone down financially and has an accumulated  loss of more tha Rs. 20,000 crore. Dues are also to be paid to the vendors and oil companies.

Now the Ministry has requested the government to grant a budgetary support of Rs. 19,911 crore to the Air India to tide over its difficulties. The government should approve the demand and provide the same to the company at the earliest. The government should also pay immediately, the Rs.110 crore due it is to pay to the AI for having utilised for VIP travels.

Trust Research Advisory’s brand trust report has ranked Life Insurance Corporation of India (LIC) as the country’s most trusted brand in the banking and financial institution (BFSI) space, for the second consecutive time. State Bank of India was ranked second.

ICICI Bank ranked the third most trusted brand in the BFSI sector, followed by Housing Finance Development Corporation and HSBC.

Overall, LIC was ranked 8th among 17,000 brands studied while SBI was ranked 19th.

Trust Research Advisory’s chief executive N Chandramouli said: “Both LIC and SBI have ranked first and second in the BFSI sector for two years consecutively.”” This marked a preference for state-owned brands in BFSI category ( Courtsey: ET)

The Cabinet may take decision to allow 49% FDI in domestic air-line companies shortly, it is reported.  The FDI will be applicable to government owned Air India also. The present financial crisis in Air-India is being utilised by the government to disinvest as also bring in FDI, which  is against the interest of the nation.

The Department of Industrial Policy and Promotions (DIPP) has put up a draft note for inter-ministerial consultation on FDI by foreign airlines.

Though the DIPP note talks about only 26 per cent FDI, “a Committee of Secretaries has favoured higher FDI and we will work accordingly,” it is stated.

Virgin Atlantic,  Emirates,Singapore Airlines etc may take this opportunity.

According to Bombay Stock Exchange,  the  price of PSU shares have gone up in most cases. Out of 60 PSUs in its index, 55 have got increased prices for their shares. Their dividends being paid to Government will also increase according to the increased profit.

Despite the anti-PSU policy, many public sector units are still going strong. We have to see that BSNL also is restored to the level of profit making PSUs.

The panel appointed by the government with S.K.Rangoota as Chairman has recommended that  the loss making PSUs also should be disinvested. This is in addition to the disinvestment of profit-making PSUs. The Committee has also recommended that at least disinvestment should take place in 50 PSUs  within the next three years. The report has already been submitted to the Planning Commission.

The committee has also recommended  creating a Public Sector Land Development  Authority ( PSLDA) to develop the PSUs land asset  and utilise them commercially. It may mean to sell it also.

The government is in undue hurry to hand over all the PSU assets to the private companies and big business.