Failing to take off

There is,regrettably,no surprise that Gustav Baldauf chose to resign as Air Indias chief operating officer. A zealousness to micro-manage the national carrier is too much a part of the Central government. Indeed,by issuing a show-cause notice to Baldauf for stating just that that the government played too prominent a role in the airline Air Indias management proved just that. When Baldauf,an Austrian national,was inducted into the airline,it was seen as a faint signal by some that perhaps this time the government was thinking out of the box and was committed to reviving the airlines fortunes. The reason for his exit should extinguish any lingering optimism. The development,however,does frame the issue as it is: is it worth this countrys finances to keep pouring good money for the uncertain benefits of having a national carrier? After the frivolousness of this latest crisis,can we finally acknowledge that incremental steps of new hires and periodic bailouts will not restore the leaking flagship to any semblance of financial health?

Those questions are validated by the allocation,in the Union budget announced this week,of Rs 1,200 crore to Air India. Thats Rs 800 crore short of demand made to the Central government. Indeed,in Civil Aviation Minister Vayalar Ravis estimate,it needs Rs 10,000 crore more. But for a country that is now looking to adopt different mechanisms to ensure adequate outcomes and efficiently targeted subsidies,such allocation and such future estimates should strike anyone as unduly wasteful. That there is doubtful benefit to the public by these regular infusions of cash was brought out recently when the Directorate General of Civil Aviation released data for domestic air traffic in January. Air Indias domestic wing had slipped to fourth place. Jet,Kingfisher and IndiGo each flew more passengers than Air India,that too by a large margin. The DGCAs figures also showed that Air India reported low occupancy and the lowest on-time figures. If this were any other company,its shareholders would have seriously reconsidered their investment.

But,of course,Air India is not any other airline. An anachronistic pride in a national carrier a notion exploited by unions and the ministry has meant that any movement on a sensible disinvestment plan has been averted. The notion has also,all too wastefully,nourished political support for reviving the airline without demanding of the management a rational case for more funds. The market clearly is not in awe of a national carrier. It is time we politically junked the idea too,and thereby created the conditions for a realistic appraisal of what to do with a problem called Air India.