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It Is Not Impossible To Turn Around AI: Harshvardhan

Harsh Vardhan, Civil Aviation expert and Chairman, Star AIr Consulting talks to Sanjay Thapa Jeet in a freewheeling tete-e-tet about the various options and the ups and downs of the Air India sell-off in the past. Its indipensibility as a national flag carrier and wether the sell off will at all be beneficial

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Is it a good idea to sell off a white elephant for the govt which is in the election mode -- 2019-- and the recent questions on Modi's comeback in 2019?

It is unfortunate that people are terming Air India as white elephant which till sometime ago was the jewel in the crown. It is a viable commercial unit. Any commercial organization, if not run efficiently, can suffer the fate of Air India. It is about time that Government recognizes the problem of leadership and autonomy in the organization and put it back on the path of recovery.


Now what is the way forward for the govt on AI disinvestment having failed second time to get buyers? Your opinion on how it can be turned around.

 According to me, it is not a very difficult job. Air India has the best infrastructure and market placement. It also has one of the best techno-commercial team. It is lacking in directions and frequent changes at the top are resulting into low morale and fighting spirit among its employees.

There is a political interference in selling off AI. RIght wing political parties like Sangh and SJM have openly countered the selling. To add to this the dozen-odd unions in AI are tooth and nail against its privatisation and prefer it to bleed. Your views.

Recent exercise of disinvestment has proved to be an utter failure principally because of delay in finalizing terms of disinvestment and perception about Loan and mounting losses. Even timing wise exercise was done very late. Present NDA government is in last year of its term and any potential investor shies away from such large investment when there is even slightest risk of reversal of such decision. Moreover, regular CBI enquiries into any government transaction in India are deterring potential investors to look at public sector assets.    

Is it necessary to at all sell-off AI, after all, it is a national flag carrier and a family silver ---shouldn't it be retained as such may be through tweaking efficiency. Maybe it could face a Marshall plan like in BA, or re-packaged say like monetising its idle assets and debts including lesser govt interference.

There are ideological issues involved with Air India sales and debate on public sector versus privatization is wide open. Even some of the constituents of ruling government are airing views which are divergent to their own Government plans.

The other option of  AI being listed and open for IPO is limited as investors will not be interested in the loss-making company.

In my opinion, unless you turn around Air India no buyer will come forward & once you turn it around, then you don’t need to sell it.

Like railways is a vital connectivity infra -- to remote corners of the country and as such a subsidy is valid. 

Most of the chief executives the government has appointed lacked aviation knowledge and by the time they started understanding its basics, they were moved to greens pastures. Air India has almost become a playground for bureaucrats awaiting promotion. Unless the government takes a hard look at its functioning, I don’t see much improvement happening in its financial health In the recent past, it lost a great opportunity when fuel prices were at their lowest ebb. The need of the hour is improving its operational efficiency and such turn around will happen on tarmac & shop floor.

Any other views

Air India is vital to Nation. It is still one of the most dependable arms of Government in case of National exigencies which have been demonstrated multiple times. We live in a sensitive geopolitical environment and Air India plays a crucial role in times of crises which no other private carrier can perform. Even in recent RCS scheme, 80% of operating sectors have been added by Air India.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.


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Sanjay Thapa Jeet

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