The “emotional merger” of Air India and Indian Airlines is still to happen, Civil Aviation Minister Ashok Gajapathi Raju has said even as he emphasised that he would not like the airline to go the Kingfisher way. While describing Air India as a “lovely airline” that has served the Indian people well, the minister said there are “legacy issues” and that taxpayers’ money cannot be put in for eternity to keep it afloat. In efforts to revive the loss-making Air India, the Cabinet, in June, had given its in-principle nod for strategic divestment of the airline and its five subsidiaries. A group of ministers is working on the modalities for the process.
Raju said the merging of Indian Airlines with Air India has taken place, “but emotional merger… that is still not happening. So, there are problems”.
“Implementing Dharmadhikari (committee recommendations) that is one angle… Still, within the organisation itself there are certain problems,” the minister told PTI in an interview.
In 2012, five years after the merger of the two airlines into one, the Dharmadhikari committee had submitted its report on Air India HR issues to the government.
The merger, which happened in 2007, is seen as a major factor for the current state of affairs at Air India — which for the first time in a decade eked out an operational profit of Rs 105 crore in 2015-16.
“Its (Air India’s) finances are bad, but I, for one, would not like it to go the Kingfisher way because that doesn’t help anybody. It crashes and no activity, no employment and no contribution to the economy. That is not what I like. I want it to survive and be a vibrant airline,” he stressed.
On whether there would be job losses on account of divestment, the minister said, “I think employees will still continue because in Air India, employees are basically technical (such as) pilots, cabin crew and engineers.”
“I don’t think there will be much of a problem there. Employees would also like the organisation to survive,” he added.
Asked about the divestment plans of Air India, Raju said an alternative mechanism is “applying its mind and let them come out with the things”.
On June 28, the Cabinet Committee on Economic Affairs (CCEA) had given its in-principle nod for strategic disinvestment of Air India and five of its subsidiaries.
Subsequently, an Air India-specific alternative mechanism was set up to guide the process. The ministerial group is looking into treatment of Air India’s unsustainable debt, hiving off of certain assets to a shell company, demerger and strategic disinvestment of three profit-making subsidiaries, among other aspects.