Now days Air India becomes point of discussion as it’s ownership again move to Tata and Sons. So what was the reason behind privatization of Air India. Why it becomes biggest debt for Indian government year by year. The Airline which is roll model for Singapore Airline in 70s and become biggest profit point. So what happened to Air India. First let us see the history of Air India.
History of Air India
In 1932, India’s businessman JRD Tata started his airline Tata Airmail for the distribution of letters. On 15 October 1932 Tata Airmail take his first flight from Karachi to Mumbai. JRD Tata was one of the pilot of this flight. JRD Tata was India’s first Civil aviation pilot.
In first year Tata air mail earns 60 thousand profit by distributing 10 ton letters and by traveling of 155 passengers. In 1938 Tata Airmail rename to Tata Airline.
After second world war JRD senses that airline business can grow more. He open airline to public in 1946 and rename this to Air India. Tata has also sign contract with Indian government for International flight. Tata also focuses to modernize his venture with latest air craft carrier and equipment.
Tata include his world class carrier Lockheed constellation and name this to Malabar Princess. On 8th June 1948 Air India took his first international flight from Mumbai to London. Its fare at that time was 1720 rs.
1953 Indian government produced air corporation act to nationalize airline industry. So now Air India comes under the Indian government. JRD Tata was appointed chairman of Air India. Air India was very close to heart of JRD Tata. He take care this well. He focuses on all the facility in aircraft including food, seats, curtains etc. That is the reason in Air India reaches his peak under the supervision of Tata group.
Downfall of Air India
All was going well but in 1978 Indian government at that time prime minister was Morarji Desai removed JRD Tata as chairman of Air India. Mr. Desai was against the serving liquor in airline. But according to Tata in international flight it is good service to customers.
The decision of removal of JRD Tata as chairman proved wrong as after that service quality of Air India decreases so in the overall growth of Air India. Although Indira Gandhi once again included JRD Tata in board of director of Air India but till then it becomes late. After that downfall of Air India started. There are multiple reason behind this.
- Over staffing in Air Line
- Lack of maintenance
- Less attention in services
- Lack of upgrade.
In 2002-03 under Bajpai led NDA government Air India was in profit of 133 crore. And Air India was in profit under the initial year of Manmohan Singh led UPA government.
Actual downfall started.
There was some decisions made by civil aviation minister Praful Patel might caused the problems. Purchase of several air crafts without proper analysis of requirements. Also several profit making flights were stopped.
In 2007, Prime minister Manmohan Singh told that debt of Air India and Indian Airline was 541 cr and 240 Cr.
Total employee was 3000 including Air India and Indian Airlines.
Which was 256 employee per plan and as per international standard it was 100 employee per plane.
Story of debt continue. In 2014 total debt was 26033.
https://www.financialexpress.com/archive/air-indias-outstanding-debt-a-whopping-rs-26033-cr/1223775/
As per article in 2010 in economic time Air India demands 2000 crore to repay debts.
There was time when Air India sold his three air craft.
In 2011-12 Air India was in loss of 7853 crores. Civil aviation minister Ajit Singh told this.
Privatization of Air India is not new. Minister at that time Ajit Singh also suggested to privatized the Air India in 2013.
Ajit Singh says political consensus needed to privatise Air India – India News (indiatoday.in)
At that time government refrain himself from doing this and forward it to upcoming government.
Now current government has privatized the Air India and highest bidder is Tata and Sons. So finally Air India has owned by his old care takers. One can say that under government supervision Air India quality was not same as before as government as so many things to manage.
Now we hope that Air India once again reach his peak of success and provide us world class aviation services.
Please read another article on this https://www.writewingink.com/2021/10/10/tata-says-hello-to-air-india-effect-of-air-india-privatization-on-common-man-current-picture-of-indian-aviation-industry/