Deccan Chronicle

The Air India mess: Is there a way out?

Deccan Chronicle | DC Correspondent

Published on: June 12, 2016 | Updated on: June 12, 2016

This board will need a lot of better luck if it is to survive

Air India

Air India

That Air India, once the country’s pride, is an unwanted baby is nothing new. The crucial issue is what to do with the national carrier? How much more money should be pumped into this hapless airline just to ensure its day-to-day survival? Rs 30,000 crores was pledged as a bailout package, and more than half has been paid, so that the jobs of 30,000-plus employees are protected. There is a sordid history behind its fall from grace, where the airline was sought to be deliberately wounded, if not killed, so that private airlines could grow.

Aircraft that were not needed were ordered by the dozen, lucrative overseas routes taken away from Air India and given to private airlines, the skies opened to foreign airlines and, mysteriously, reciprocal arrangements not availed of — the sins are too many. The previous government, and even the current one, is aware of all this, but till today no action has been taken against the guilty. It’s a situation that the government has got itself into, a kind of self-goal, as one aviation expert observed.

In 2001, the Tata-Singapore Airlines combine wanted to take over Air India. The Atal Behari Vajpayee government, under dynamic disinvestment minister Arun Shourie, decided to privatise both Air India and Indian Airlines. But the government’s Lohia socialist partner erupted, saying he wouldn’t allow the airline to be sold. The disinvestment decision was, incidentally, taken by the Cabinet in which this Lohia socialist was a participant. Air India was then very profitable and, besides Tata-Singapore, was being wooed by Emirates and British Airways.

But the move was sabotaged, and then dropped. One wonders what the Lohia socialist is thinking now. As an industrialist said recently, crony capitalism is rightly attacked, but what about crony socialism? Fifteen years later, with Rs 80,000 crore down the drain and six IAS officers later (who are omniscient and claim they can tackle any portfolio), the losses could reach much more. The present CMD, not from the IAS, is trying his best to revive the airline and has managed a small operating profit, but loans are piling up.

The losses are reportedly around Rs 4,500 crores annually on an average. There is now a proposal to create a new board in a last-ditch effort to save the airline, but a number of those proposed for it are said to be unwilling. This is not the first time that a board has been constituted with the names of high-profile businessmen and experts. Some businessmen literally ran after seeing the government’s constant interference. This board will need a lot of better luck if it is to survive and breathe some new life into this star-crossed airline.

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