PM Modi’s aspirations for India being a global power to reckon with are possibly going unrecognized in one very important and perhaps a most critical area. Among our various requisites on the country’s and indeed our Prime Minister’s, wish list ought to be air connectivity between India and the world, serviced by least 2 to 3 Indian owned, globally connected and reputed airlines. A natural corollary out of the present efforts to open travel across the country is the realization that connectivity is an essential component of economic growth. The same would apply internationally, equally so, if not even more. And that, too, with a rider: we can best be serviced by only our own airline companies and not by foreign ones.
As we understand the deeper malaise of having bought into so much that was foreign origin, and some of it most undesirable, the same should worry us on the front of airline ownership and operations. We must have Indian owned entities, traded transparently in Indian markets. These must be Indian managed, employing the best of Indian and global professionals. Fortunately, in this sector, if you look globally, many an international airline has Indian origin professionals who have done exceedingly well in this field.
The moot point is that we have a national asset in Air India. Everybody recognizes the power of this Indian brand. It has the power to evoke national pride. It is the best example of “Make in India”, that has since last five decades become the pride of “Made in India”. It cannot and should not be wished away.
There has been a national effort in selling off this national, publicly owned national asset. Admittedly, the business environment has been most unfavourable in this sector, especially in the last six months. The enormous debt on its balance sheet makes the operations unsustainable for both, either the government or any new potential buyer. There is talk now of additionally taking away the already reduced debt of around Rs. 23,000 crores, to make the deal attractive to potential suitors. It is logical to presume that should the airline continue to run the airline for another 2/3 years, it would lose an additional similar sum of money. So, why not take it off the books, and sell it off now!
Today, elsewhere across the economy, our new concern has been like where data is stored, who manages it, and with what security. An airline has its tentacles across the national airports, access across security points, on the ground and in the air. Presently, with these well grounded reservations, it is just as important that we do not let this window slip out of national hands and national interests.
Where does this lead us? What is my conclusion? That the new buyer must be 100% Indian, in all respects, regardless of what they quote. So long as the transaction is 100% transparent, just as much. And the government must allow the new ownership considerable scope and opportunity to make it a world class airline, which indeed it was, or else why would it be considered a national asset, that connects India and the world.
In today’s day and age, no airline needs to fly itself to every corner of the world. It picks up strategic point to point routes. The rest are serviced through global alliances. Air India is a part of the prestigious and globally well-connected STAR alliance. With this participation, a customer can buy a single ticket that lists the intermediary connections, you book your baggage seamlessly, and can travel anywhere in the world, seemingly on one airline ( the rest are its global partners).
In tourism terms, I can say that the Air India of old was the single biggest and most prominent promoter of Indian inbound tourism; in pure strategic selling even more than the Ministry of Tourism. Every global airline in the world first promotes its home base, it is where its loyalty rests. If we wish to promote India as a tourist destination globally, we will need a strong national airline ( if not 2 or 3) that is firmly embedded in the soil and ethos of India. No foreign entity can achieve, or ensure this.
As the government tweaks one more time its terms for a final tender, as newspaper reports, this should become the single biggest restriction on its terms and conditions. Even in private hands, the government must remain committed to provide a guiding and helpful hand to ensure India has a global airline.
Additionally, we have some powerful Indian owned carriers, notably Indigo. It should get government help to go, literally places around the world. Powerful Made in India brands must get special treatment to enable them to be world class heroes.
Tailpiece: I have heard a most senior person saying the effort is towards getting the best price; and herein lies the danger. How will we define value?
