How To Privatise Air India
Businessworld|August 5, 2017

PRIVATISING AIR India could turn out to be one of the smartest decisions of the Narendra Modi government.

Minhaz Merchant
How To Privatise Air India

Laden with a huge debt, shrunken routes, reduced landing rights and deteriorating service, selling Air India is clearly the wisest option.

Air India was effectively ruined by the UPA government from 2007 onwards. Civil aviation minister Praful Patel disastrously merged it with Indian Airlines and gave away the merged entity’s most profitable domestic and international routes to Emirates, Etihad, Jet and other airlines. From being India’s national carrier, accounting for a third of the total passenger traffic, Air India today has just under 14 per cent market share.

If ever there was a wilful destruction of India’s two airlines — Air India and Indian Airlines — the Congressled UPA government and its alliance partner, the Nationalist Congress Party (NCP), did an efficient hatchet job.

Handled well, privatisation could make the airline the Tatas founded in 1932 rise like a Phoenix from the ashes. The key question: are private sector buyers interested in Air India? Apart from Indigo Airlines, which has already officially expressed interest in a letter to the civil aviation ministry, there are several Indian and global airlines and private equity players who would be keen to own Air India.

The Modi government wants a quick sale, perhaps as early as next year. A crucial issue is whether to divest the whole of Air India or sell its subsidiaries (including Air India Express) and other assets in parts. Divesting the airline as a whole would likely fetch a better valuation.

With oil prices low, the economic fundamentals of the aviation industry have improved greatly since 2015. Air India too has cut its annual losses and is operationally profitable. With staff rationalisation and better route utilisation its balance sheet could improve further.

Denne historien er fra August 5, 2017-utgaven av Businessworld.

Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.

Denne historien er fra August 5, 2017-utgaven av Businessworld.

Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.

FLERE HISTORIER FRA BUSINESSWORLDSe alt
MEMORIES & IMPRESSIONS
BW Businessworld

MEMORIES & IMPRESSIONS

Ratan Tata was an exceptional human being. He was a visionary leader, esteemed industrialist, and a humanitarian, who left an indelible mark on India and the world.

time-read
3 mins  |
October 19, 2024
The Robotaxi Market
BW Businessworld

The Robotaxi Market

The robotaxi market is shaping up to be a high-stakes battleground as tech giants and automakers race to transform urban mobility.

time-read
1 min  |
October 19, 2024
And the Nobel Prize Goes to AI
BW Businessworld

And the Nobel Prize Goes to AI

The recent Nobel Prize T awards to AI pioneers affiliated with Google have sparked a broader conversation about Big Tech's influence on research and the limitations of traditional prize categories.

time-read
1 min  |
October 19, 2024
Ola Electrified
BW Businessworld

Ola Electrified

Once considered a trailblazer in India’s electric vehicle (EV) ecosystem, Bhavish Aggarwal’s Ola Electric now faces a major accountability crisis.

time-read
1 min  |
October 19, 2024
Sharp Slide in Industrial Output on Eve of Deepavali
BW Businessworld

Sharp Slide in Industrial Output on Eve of Deepavali

India’s index of industrial production (IIP) saw a sharp reversal in August, contracting by 0.1 per cent, in stark contrast to the 4.7 per cent growth in July, mostly because of significant contractions in mining and electricity generation.

time-read
1 min  |
October 19, 2024
Heralding the Solar Era with Sustainable Electrification
BW Businessworld

Heralding the Solar Era with Sustainable Electrification

RAJEEV KASHYAP on the economics of solar power, the hurdles in scaling it, and much more

time-read
2 mins  |
October 19, 2024
A WELL-GREASED MACHINE
BW Businessworld

A WELL-GREASED MACHINE

The OmniBook X14 laptop runs on first-generation Snapdragon X Elite, which bets big on Al-enabled productivity and battery life, but falls short when it comes to overall experience, says Deep Majumdar

time-read
4 mins  |
October 19, 2024
DO NOT LETA HEALTH CRISIS RUIN YOUR FINANCIAL HEALTH
BW Businessworld

DO NOT LETA HEALTH CRISIS RUIN YOUR FINANCIAL HEALTH

For a family of four living in a metro, it is recommended to opt for a family floater health insurance plan with a sum insured of at least Rs 15-20 lakh

time-read
7 mins  |
October 19, 2024
Disruption Ahead: Beyond Organisation Charts and Structures
BW Businessworld

Disruption Ahead: Beyond Organisation Charts and Structures

ALBERT EINSTEIN FAMOUSLY said, “We cannot solve our problems with the same thinking we used when we created them.

time-read
3 mins  |
October 19, 2024
Dr. Rahul Shivajirao Kadam: A Visionary Leader Blending Sustainability, Innovation, And Social Empowerment
BW Businessworld

Dr. Rahul Shivajirao Kadam: A Visionary Leader Blending Sustainability, Innovation, And Social Empowerment

We are on the stage of global warming, and these technologies not only help prevent further damage but also leave behind a better environment for future generations.

time-read
2 mins  |
October 19, 2024