MUMBAI - Employees of India’s flagship carrier Air India have commenced their two-hour-long protest over non-payment of wages on Friday afternoon, even as the airline management sternly warned that it would take action against them.

In a letter to all employees, Air India’s Chairman and Managing Director, Arvind Jadhav, said: “The gravity of the situation has not seemingly sunk in all of us. Many of us continue to believe that our financial requirements can be met by taking loans endlessly and that the financial situation is not that grave. Considering the critical financial state of the airline, we should all be prepared to face the impact of harsh decisions that will be required to be taken to meet the current situation. There can be no escape from harsh realities. We also need to make a choice between austerity and oblivion.”

The unions had earlier called off their proposed strike on June 30 after the management had agreed to pay the salaries of 70 per cent of workers by today.

The Air India management warned its employees of wage and allowance cuts if they participated in the protest.

Aviation Industry Employees Guild (AIEG), Air Corporation Employees Union (ACEU) and some other unions walked out of their offices nationwide and stage demonstrations on Friday, besides threatening to boycott their meetings with the management.

In Mumbai, an airline spokesman said steps were being taken to ensure smooth operations across all airports in view of the proposed agitation.

Passengers travelling on the airline were critical of the walk out, saying it was uncalled for when everyone knew that the airline was deeply in the red.

Civil Aviation Minister Praful Patel has said the government cannot bail Air India out every time, and it is time for the flagship carrier to tighten its belt and resolve its financial woes.

Air India’s borrowings have risen from Rs.6, 550 crore in November 2007 to Rs.15, 241 crore in June this year.

He said that the airline has been asked to prepare a restructuring plan in the next 30 days.

In reply to a question in the Lok Sabha, Patel said the borrowings have gone up largely due to servicing of debt on account of purchase of new aircraft and its operating losses, which have compounded due to the present economic recession and the high oil prices last year.

He said the National Aviation Company of India Limited (NACIL) has been advised to formulate “a concrete proposal for equity induction and provision of loans”.

Patel also made it clear that there was no plan to retrench any employee of Air India. (ANI)