AI cancels costly deal with Aussie firm for image makeover

Loss-making Air India today said it has cancelled its controversial $1.6 million deal with an Australian firm to revitalise its brand identity for the upcoming Commonwealth Games.

"Following a review of the brand and identity management plans, the project with Cato Purnell Partners has been annulled," an Air India spokesperson told PTI when asked about the fate of the deal.

Sources said the agreement was cancelled last evening after a controversy broke out following a question asked in Rajya Sabha whether the ailing national carrier had entered into such an agreement.

In reply, Civil Aviation Minister Praful Patel had said "Cato Purnell Partners have been appointed by the National Aviation Company of India Ltd (NACIL) to revitalise its brand identity, and the fees payable to them would be around $1,612,750 plus taxes".

The Minister had said that the tie-up would help develop an identity and broader visual language that would allow NACIL to be seen as a meaningful partner to the Games.

The consultant, he said, would also help the national carrier develop a migration strategy and design, and revitalise the Air India brand.

In reply to another question, Patel had said Air India has suffered losses of Rs 13,430 crore in the last three years.

The national carrier, which incurred losses of Rs 2,226.16 crore and Rs 5,548.26 crore during financial years 2007-08 and 2008-09, is expected to incur a loss of Rs 5,656.52 crore during 2009-10.