The glaring failure of the Air India privatisation initiative of the Central government — not a single bid was received for the 74 percent equity stake of this bloated public sector airline offered to all investors worldwide on May 31 when bidding closed — is further proof that the country’s neta-babu brotherhood ensconced in the highly-subsidised comfort zone of Lutyens’ Delhi, lives in a fantasy world.
For one, which investor in his right mind would want to partner with an airline which during the past 65 years since it was nationalised purportedly in the public interest, has run up an accumulated loss of Rs.55,000 crore despite several government bailouts? Even if this massive loss is written off and dumped on the public exchequer as hinted by the government, are big ticket investors so stupid that they would fail to discern that by retaining 26 percent equity, the clear intent of the government is to switch from front to back seat piloting of Air India?
Moreover, it’s well-known that one of the non-negotiable preconditions of the global auction is that the employment and rights of Air India’s 21,000 employees divided into ten unions are sacrosanct (hence the 26 percent equity retention). And why this overriding concern for the well-being of the airline’s employees? Because 99 percent of them are employed on the basis of their political connections rather than competence.
Unsurprisingly, Air India has more employees per aircraft than any commercial airline worldwide, a major cause of its pathetic condition.
Presumably chastened by the global rejection of its proposal, the government is reportedly reconciled to sell this broken airline — which chalks up a loss of Rs.3 crore per day — lock, stock and barrel. But even so it’s doubtful if there won’t be disabling preconditions because there’s no real will within the establishment to sell this golden goose, notwithstanding its emaciated condition.