A ministerial panel will decide on how much compensation Air India should seek from the US-based aircraft manufacturer, Boeing, for delay in delivery of the Boeing 787 aircraft, a senior Government official said on Tuesday.

Declining to specify whether the issue will be decided at the level of the Cabinet Committee on Economic Affairs or some other level, a senior Government official merely said “a decision will be taken at an appropriately high level in Government.”

The Government is now waiting for the Air India board resolution passed on Monday seeking compensation from Boeing. The airline is seeking compensation as there has been a delay of close to five years in the delivery of the first of the 27 aircraft Air India had ordered.

Sources said that till such time as the compensation amount is decided the airline will not take delivery of a single Boeing 787 aircraft. It is expected that compensation will be sought against each of the 27 aircraft being procured.

Officials claimed that the chances of the compensation issue being caught in arbitration were few as both sides wanted a quick resolution to the current impasse.

The amount being sought in compensation has not been made public citing confidentiality clause in a commercial agreement between Air India and Boeing.

However, a Parliamentary Committee report released in March 2010 had quoted the Airlines former Chairman and Managing Director, Mr Arvind Jadhav, as saying, “We have slapped a compensation claim of $710 million. Obviously, they have confirmed $145 million they will pay as compensation for the delay and so we have tried to push the entire delivery.”

> ashphadnis@thehindu.co.in

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