Spotlight
New
Delhi, 19 May 2019
Knifing the “Maharaja”
By Proloy Bagchi
The news has just come in that Government of
Maharashtra has offered Rs 1400 crore for the iconic Air India building at
Nariman Point, Mumbai. Though the amount offered is Rs 200 crore less than what
was declared as the reserve price, Air India authorities were seemingly
inclined to give away the building to the State government. The Life Insurance
Corporation had offered Rs1375 crore whereas Jawaharlal Nehru Port Trust Rs
1200 crore. Hence, by June-end one could hope the Maharashtra Government
offices to move into the building. Perhaps even Chief Minister Fadnavis is
likely to relocate to this building and one might find the National Flag on top
of it instead of Centaur of the logo of Air India.
This building has been a remarkable structure
dominating the business district that came up on what came to be known as
Backbay Reclamations. I can recall that during my first visit to Mumbai (then
Bombay) in 1955 tetra pods used to be built there as the work of reclamation
went on. It was a vast expanse of sand and tetra pods would be lined up for
being placed next to the parapet of Marine Drive along the Arabian Sea. Then
this iconic building slowly took shape designed by an architect from New York.
Facing the beautiful Marine Drive it came to dominate it, adding more
sophistication to an already sophisticated artery lined by art-deco buildings.
Air India is steeped in debt of around Rs 50,000
crore and had decided to monetise its physical assets. It had put up its
lease-hold rights over the land and the building for sale last December with a
reserve price of Rs1600 crore. The sale was open to only various governments,
their departments and public sector units. None of these entities, however,
could muster an amount equal to the reserve price; the offer of Maharashtra
Government happened to be closest to it. In all probability, therefore, its offices
are likely to move in in a few months time.
Air India hit this sad predicament largely because
of politicians who came to control the airline. Time was when Air India, to use
a cliché, used to rule the skies and other up-and-coming airlines would try and
learn micromanaging their assets from none other than its chief JRD Tata. Tata
was a freak insofar as flying was concerned. His commitment to the airline from
its initial days, when it had only two pilots and a few sundry employees, was
basically the reason for its becoming an exemplar for others.
In the 1960s when Air India was still flying
propeller-driven planes, connoisseurs would still opt for the slower Indian
planes than the faster jets for the simple reason that Air India would pamper
them. For the sake of the high quality service they would think nothing of
sacrificing a few measly hours that could earn them a few thousand dollars.
That is when it suffered the first assault
from a politician. In the 1970s, Morarji Desai as Prime Minister issued a
dictat that no alcohol could be served on Air India’s international flights.
JRD Tata fought the fiat tooth and nail but had to resign, as Morarji was, if
not more, resolute than Tata. With Tata’s exit, service standards dived
southwards and the clientele that Tata had built up progressively deserted the
Airline. At the same time, competition hotted up and those who were pigmies
when Tata was around put more heft in their operations and left Air India miles
behind.
Then came the era of “coalition compulsions” --
UPA’s two terms at the Centre that administered blow after blow to the Airline
that had the sobriquet of “Maharaja”
and was soon enough to lose all the trappings of royalty leaving, people asking
“who killed the Maharaja?” No, none
from the outside; it was a well executed inside job.
While unaffordable order for as many as 111
planes was placed, the Airline inexplicably surrendered profit-making routes to
Middle-East/ South-East Asia and Europe to its competitors. The Public Accounts
Committee, when seized of the matter, found that it was the Ministry of Civil
Aviation that wouldn’t listen to protestations of Air India and Indian Airlines
and surrendered to their competitors, what were essentially milch cows for them.
Thus, we had a situation where Indian planes
would fly half empty to these destinations, whereas airlines like Emirates
would rake in unconscionable plane-loads of air traffic from the Indian
hinterland in the new environment of generous “bilaterals” under India’s
curious version of “Open Skies”. Air India, thus, lost out to foreign airlines
under the Ministry of Civil Aviation’s direction, the traffic that legitimately
was its own.
Everything that was done to bring the Airline
down was done by the Ministry of Civil Aviation which in those turbulent days
was being headed by Praful Patel, who was a contribution to the UPA-I
government of Manmohan Singh of, ironically, NCP, headed by Sharad Pawar. No
“nationalist” with the slightest of feelings for the nation and its people
could ever have shot down a high flying asset of the nation like Air India in
the way Patel did.
R Jagannathan, Editor in-Chief of the
perceptive Firstpost wrote in a
feature the technique adopted by Patel to kill Air India. Basic proposition was
to load it with heavy loans that it could never raise its head again. An airline
with a revenue of Rs 7000-crore was asked in 2004 to take on debt of Rs 50000
crore -- the cost of the new aircraft, the number of which was arbitrarily
inflated from 28 to 68 without any revenue plan or route map for deployment of
the additional aircraft.
Likewise, Jagannathan says Patel was a great
promoter of merger of Air India and Indian Airlines by pitching up the
synergetic operations of both. However, in the process he forgot that both the
airlines were incurring losses and were in every other way were unequal. Their
manpower was differently trained, the compensation mechanisms were different
and so on. The ultimate result was neither could pull the other up from the
morass each was sinking into. No wonder, both, together, have run up a huge
resources crunch that, many experts feel, is impossible of mitigation.
In the midst of this unmanageable crunch
again the Ministry (read Patel) decided to withdraw Air India from the profit-making
routes that largely sustained it. What one gets to feel is that it was the best
example of crony capitalism; for example, the lucrative S-E Asian routes were
surrendered to Kingfisher Airlines – an airline that Patel used to patronise
while flying between Delhi and Mumbai. Vijay Mallya was apparently much more
than a friend, in fact, a crony.
While bringing down the “Maharaja” Patel seems to have covered his tracks very well. In
achieving what he achieved, he reportedly moved files at supersonic speed from
one authority to another. Every establishment concerned was kept in the loop so
that the murder of the airline could be presented as a “collective and
consensual” effort! ---INFA
(Copyright, India
News & Feature Alliance)
New Delhi
17 May 2019
|