Airline officials express dismay over non-inclusion of any package which they could have exchanged with expensive short term loans of over Rs 1,100 crore. This comes at a time when for the fiscal 1999, the airline is expected to face the prospect of a massive loss of over Rs 300 crore. ``Though the bailout package was discussed in the pre-budget consultations with the finance ministry officials, nothing came out of it,'' say Air India officials. The airline's precarious financial condition with no signs of any revival in future is set to wipe off the entire net worth of the airline, fear analysts.

The budget was expected to prop up the sagging fortunes of Air India which was put on the block but no steps have been taken tilldate for its privatisation despite an exhaustive framework of 40 per cent disinvestment prepared by Disinvestment Commission.

The only concession given by finance minister is the extension of the period for income-tax exemptions, for any payment made by an Indian company for the acquisition of an aircraft or an aircraft engine, on lease under an agreement entered into before April 1997 to an agreement entered on or after April 1999. This, say analysts, would pave the way for the aircraft induction programme of both Air India and Indian Airlines. But with both the airlines sitting on their aircraft acquisition plans over the few years, the only beneficiary of this move would be private airlines like Jet and Sahara who are on a massive acquisition drive. In his first budget, the finance minister had announced a Rs 125 crore as equity infusion for Indian Airlines but in the year-end decided to cut it down to Rs 5 crore as Indian Airlines has not finalised any aircraft acquisition plan. A similar fate nowawaits Air India which has no aircraft acquisition plan or a future strategy to meet competition. A bailout of loss-making and highly unionised Air India by taxpayers money, say aviation analysts, is tantamount to throwing money into the sea.

On the other hand, Indian Airlines is expected to show some signs of revival after the end of current fiscal but again the ministry has failed to take any action on the promises made by Sinha that the airline would be privatised to the extent of 74 per cent in three years. Sums up an ex-AI chief: "No one in Delhi would like to lose power over the airlines. Therefore, all kind of obstacles are being put into the airline's disinvestment plans from the civil aviation ministry. Only an aggressive push from the prime minister and finance minister level can salvage these airlines."