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Last Updated: Wednesday, 9 May 2007, 14:31 GMT 15:31 UK
Biman announces huge job losses
Biman flight
Biman needs to be saved before it flies into the sunset
Bangladesh's state-owned airline, Biman, has announced plans to slash its workforce by June as part of a privatisation initiative to cut losses.

A senior Biman official told the BBC on Wednesday that more than 1,400 jobs would eventually be lost.

In April the interim government decided to turn Biman into a public limited company by the middle of 2007.

The airline is now so cash-strapped it is struggling to pay salaries and maintain its elderly fleet of aircraft.

Bloated staff

"We are seeking 3bn taka [$43m] from the government to pay off the to-be-retrenched staff ," Biman's Managing Director, MA Momen, told the Reuters news agency.

Biman flight
The government is reluctant to let Biman operate independently

The authorities have not revealed when shares will be floated on the country's two stock exchanges in Dhaka and Chittagong.

But officials say that initially the government will retain a 100% stake, appointing an operator to run the airline for some time.

Correspondents say that Biman's erratic passenger schedule, the poor state of its 13 elderly aircraft, its bloated staff numbers and its failure to pay fuel bills have all given the impression that it has hit severe turbulence.

Officials say it will incur huge losses in the next financial year
At least five of its 13 aircraft are out of action
It owes millions of dollars to Bangladesh Petroleum Corporation
It faces spiralling costs in aircraft maintenance and fuel prices
A DC-10 and a Fokker F-28 were written off in recent accidents

It owes 12bn taka ($173.91m) to state-owned fuel supplier Bangladesh Petroleum Corporation (BPC).

A shortage of aircraft forced it to stop flights to New York, Paris, Tokyo, Frankfurt, Brussels, Rangoon and Mumbai in 2006.

In recent years Biman has been beset by corruption allegations, especially over aircraft-leasing, with government-appointed middlemen usually named as the beneficiaries.

The airline's woes have been pinned by many observers on the reluctance of successive governments to relinquish control of Biman and allow it to stand on its own feet.

One report estimated that Biman pays every passenger it transports an average of $20 in compensation for delays.

Bangladesh Biman hits the buffers
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