Against the breeze

The Directorate General of Civil Aviation released figures for domestic air traffic in January that showed that Air India’s domestic wing,the former Indian Airlines,has slipped to fourth place. Jet Airways,when figures for its low-cost wing JetLite are included,Kingfisher and IndiGo flew more people than Air India — by a significant margin. Air India flew 7.8 lakh flyers; Jet flew 12.2 lakh,Kingfisher 9.6 lakh and IndiGo 9.5 lakh. As a marker of the continuing decline and increasing irrelevance of what is still referred to in wistful sarkari circles as India’s national carrier,it doesn’t get clearer than this. Air India simultaneously reported the lowest on-time figures: barely a third of their flights were on time,well below the competition; occupation rates were similarly low. Its market share is now around 17 per cent. Were it purely a market decision,it’s beyond any doubt what Air India’s fate would be.

Tragically,it is not the market’s decision to make. Civil Aviation Minister Vayalar Ravi had barely settled into his new office after the recent reshuffle when he made it clear that he would be requesting a significant infusion of cash into the troubled airline — merely,he claimed to tide over what he seemed to think was a temporary crisis. These thousands of crores of taxpayer money will be on top of the Rs 2,000 crore that has already been made available to Air India in two tranches recently. Ravi’s estimate is that the company will need at least Rs 10,000 crore more. This comes,of course,at a time when a cash-strapped UPA 2 is desperately trying to reassure voters and international investors that it knows how to control spending; fiscal restraint is expected to be a crucial component of the budget exercise.

We live in a very different world from the world in which “flag carriers” were a necessity. India is a self-confident nation now,and much of that self-confidence comes from pride and faith in the efficacy of its vibrant private sector. The emotional kick that a “national carrier” is supposed to provide is hardly needed or wanted now. Nor is it the case,as the DGCA’s numbers eloquently argue,that it fulfils any conceivable market-supporting role. Whatever decisions have to be taken about Air India in the short- and medium-term should reflect these two,essential,long-term perspectives. Otherwise,those decisions,like so many taken about Air India in the past,will be self-defeating and expensive in a way we cannot afford.