Recently there have been many news item in media regarding dis investment by govt in Air India.The total debt of Air India has reached Rs 50,000 crore mark. Till 2002 both Indian Airlines and Air India were operating in a proper manner, but slowly with the advent of private Air Lines, both the state owned air lines started to loose their business, because of the apathy and wrong policies of the UPA govt. First without going into deep about the loss of business they started pumping money into the both the air lines. Presently the interest burden of Air India every year is more than Rs 4,000 crore. There were many other questionable decisions taken by UPA , some of them are listed below:
- Why the merger of Air India and Indian Airlines was allowed without going into the details of Pros and Cons.The merger has not led to desired results as announced by then Civil Aviation Minister
- Why some profitable sectors were dis continued by Air India/Indian Airlines and the same were allotted to private airlines.
- After the merger, who authorised whom to place order of 111 new air crafts is a still a mystery, without having detailed future plans of their utilities, at the time when airlines combined turn over was about Rs 15,000 crore. The value of the new air crafts was about Rs 70,000 crore. In the world no company will behave in such manner, where you are ordering for new planes whose worth is 5 times your present turn over. Now after the NDA govt took over, this matter was handed over to CBI to investigate, and they have files some charge sheet against some unknown persons in Ministry of Civil Aviation.
- For last one decade govt has infused more than Rs 25,000 crores in Air India, but still of no use. UPA govt promise to give Air India Rs 30,000 crores from 2012 to 2022.
The present NDA govt says that they are looking for strategic partner for dis investment, and as per Finance Minister against Rs 50,000 debt, the value of present air crafts owned by Air India is Rs 20,000 to 25,000 crore and to cover rest of the debt there are other assets of Air India and its subsidiaries.
Recently Finance Minister made a statement that Air India is having a market share of about 14%, he says when the privately owned companies can handle 86% market share, then they are capable of handling 100% also. So he says Air India has to go in for dis investment, and has to look for a strategic alliance partner.