The issue of how much compensation Air India should receive for delay in delivery of the Boeing 787 has been decided by the Group of Ministers.

The GoM, headed by the Home Minister, Mr P. Chidambaram, met on Wednesday to consider the issue.

Air India is seeking compensation as delivery of the aircraft has been delayed by over three years.

Initially, the delay was on account of production problems that Boeing faced. At least three of the 27 aircraft that Air India was to take delivery of are ready but have not been brought into India due to the recent agitation by a section of pilots and the Government wanting to settle the compensation issue before accepting the aircraft.

The exact amount that the airline will receive for the over three-year delay in delivery of the Dreamliner B 787 aircraft has never been officially made public.

Deposing before a Parliamentary Committee, the airline’s former Chairman and Managing Director, Mr Arvind Jadhav, had said, “We have slapped a compensation claim of $710 million. Obviously, they have confirmed $145 million as compensation for the delay and so we have tried to push the entire delivery.” The Parliamentary report was made public in March 2010.

Air India has ordered 27 Boeing 787 aircraft. The Civil Aviation Minister, Mr Ajit Singh, said the issue will now go to Cabinet Committee on Economic Affairs when it meets next.

(This article was published on July 25, 2012)
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