Air India should not be sold off. Except for the fact that there is a huge debt liability there are significant assets in terms of skilled, trained and experienced manpower, a huge goodwill, an excellent fleet of aircraft and availability of slots at international airports all over the world. All these can be put to profitable use if there is a robust long-term plan.
The highly skilled manpower in all aspects of civil aviation operations can be effectively utilised for undertaking activities on behalf of other international carriers in respect of, among others, ground handling, ramp handling, engineering, maintenance, and cargo handling. It has been a point of criticism that Air India has surplus manpower and that is attributed as one of the major causes of its financial crisis. This so-called excess manpower can be a source of strength for providing the aforesaid services to other international airlines which necessarily have to outsource these activities. What is required is a one-time infusion of funds in Air India to meet debt and other liabilities and working capital to sustain flight operations and services. Let a bold decision be taken by the government as otherwise the huge resources of Air India, developed since early 1960s, would go to waste.
Merger pangs
It is not that Air India has not been managed properly. It can boast of excellent management and administrative staff in addition to trained and skilled licensed categories of employees. The cause for Air India’s financial mess was the decision to merge the two legal entities — Air India and Indian Airlines — into one.
Erstwhile Indian Airlines was operationally one of the best airlines despite new competitors. Financially its performance was satisfactory. Erstwhile Air India had tried to overreach by adding new destinations instead of consolidating its existing business and outreach.
Air India could have made a good turnaround if correct business and operational decisions had been taken. Then the merger came and the problems started to multiply. It was a Herculean task and though a decade has passed by, yet the problems are not over. It is during this period that the downfall started. The two airlines could have survived on their own by process of rationalisation, expert guidance and innovative marketing strategies as in the case of private airlines. But that was not to be and now we have the one entity — Air India Ltd.
Fortunately, the task of merger has been completed in almost all respects barring integrating some licensed categories of employees of the two erstwhile airlines. This has been one of the most intensive exercises undertaken by any entity, involving nearly 30,000 employees. All merged cadres are in place. This is a commendable effort on the part of the top-management of Air India. Having accomplished the most difficult task of integrating the assets and liabilities and the workforce of the two erstwhile airlines it will be least desirable and appropriate to sell off the airline. Air India has shown resilience and is operationally doing fine. If the debt liabilities are met by one-time infusion of funds or by other enabling action to write off the liability, Air India has the potential of becoming India’s premier airline once again.
Air India should be given a fair chance of survival and it is certain that due to its inherent strength of experience and availability of trained and skilled manpower, the airline can and has the potential of reaching great heights.
The writer is President, Society of Indian Law Firms.