Tatas Write To Unions On Airline

The Tatas have written to the leading trade unions - AITUC, BMS, HMS and CITU - to counter their opposition to the proposed airline venture.

The union had on Tuesday urged the Prime Minister to intervene with the Foreign Investment Promotion Board (FIPB) so that the project was not cleared.

The Tatas have pointed out to the unions that their proposal envisages 60 per cent equity from the Tata group and as per government policy, plans to have 40 per cent equity from foreign investors with no stake from foreign airlines.

It has pointed out that the Tata proposal is also from a section of "domestic industry". The unions have asked the government to reject the proposal so that the domestic industry's interests are properly protected.

The letter points out that every single private airline either has investments from abroad or has sought and been given permission to do so either from non resident Indians or from other foreign investors. "This is true of Jet airways, which is owned by an NRI and it is true of East West and Modiluft which have the government's permission to have foreign investors so that they can resume flying".

The Tata letter also questions the trade unions assertion that there have been "clandestine deals." It has pointed out that the FIPB has not been able to take a decision on the project because the ministry of civil aviation has not given its recommendation to it. "There have been no behind the scene or clandestine deals", the letter asserts.

The letter also counters the unions' argument that the proposal is against national interest. It points out that the project envisages investment of Rs 1,475 crore, including foreign direct investment of more than $80 million and will create over 2.400 jobs in the next five years in the country.

It says that as representatives of the working classes, these unions have a huge responsibility to enhance the nation's true interests.