Looking back, one of the major pride of India around the world was Air India. Its demise is near at hand. The government, faced with a worsening economic and other crises afflicting the national carrier and its subsidiary Air India Express, has come up with plans – the second time in two years – to completely sell the stakes. This, in case someone is ready to buy them up.
Clearly, it is proven time and again that the government cannot run entities on a commercial basis. There are the problems with lack of proper management, the problems posed by employees who not want to walk the extra mile, and there are the problems posed from the ministry and bureaucratic levels too. Most public sector institutions are facing serious odds and are not able to stand up on their own, and losing out to private sector which introduces better management techniques and enforces discipline.
Air India flights often got cancelled for reasons of poor maintenance. The resultant inconvenience to passengers can only be imagined. The UPA periods saw mismanagement also as regional parties and their representatives allegedly made mincemeat out of Air India and AIE through multiple indulgences. Five years of the Modi rule too did not help change the fortunes of the national carrier for the better.
The infusion of funds by way of a bailout, involving Rs 30,000 crore, in 2012 by the Manmohan Singh government did not help AI and its subsidiary to spruce up. The debts of the national carrier kept mounting to a level of Rs 60,000 crore. It was clear for some time that Air India and its subsidiary cannot be saved. While the attempt to sell 76 per cent stakes by the government failed last year, there is no guarantee that the sale plan will succeed this time. Else, the way out for the government is to close down the operations. Notably, the two entities have a staff of 16,000.
Ever since Air India started operations in 1953 on Indian skies it always had an edge and carried on that way for decades for want of competition. The entry of private airlines meant Air India could not withstand competition of a high order. Many PSUs are in a rudderless state and reporting losses year after year. Bureaucratic inefficiency coupled with political interference at the highest levels ensured that PSU’s only served a limited purpose not a public one. The PSU banks are facing serious odds. The railways too are awaiting privatization. Overall, the scenario is pretty grim.