BNK and others by participating in this discussion,are greatly contributing to our understanding of the subject. I think the Morarji formula should be applicable all captains of the industry, just not airline! We are in our businesses/professi Sir, I would like to share with your readers an experience with Morarji Desai when he was the finance Minister. I was a member of a delegation of small and medium size newspapers and magazines association of the country. We wanted to appeal to the FM requesting him to subsidize the newsprint prices or reduce taxes related to printing & publishing fo small and medium size media. We waited for the FM under a shamiana. He came, sat down and listened to the leader of the delegation patiently. Then, he relpied. : "Friends, can any one of you tell me if I had asked any one of you to publish a newspaper or magazine as the FM? There was no answer from any one of us as we none of us did. He continued," You started your paper because you wanted to make money as a business. You have to manage your business yourself. The government cannot come to your aid by subsidy. Namaskar". This statement is applicable to the CAPTAINS of our airlines. I only hope the Government will abide by the Minister's statement released today. R.Desikan Trustee Consumers Association of India Chennai 600 041. Phone: 044 2449 4576/78,
In this context,I would like to bring to attention a crucial point made by Prof C.K.Prahlad,
Busines Standard and Times Now news brought out that the Private Airlines rattled the sabre mainly to stall revival programmes for national carriers Air India. For years private arilines are eyeying to buy this flagship and have developed nexus with political and bureaucratic forces to sabotage AI and avoid competition. Ai's problems are not only because of poor management and political interference but also becasue of a quiet conspiracy to make it sick so that they can reduce its valuation and gobble it up cheap.
I Can narrate an inside the Govt story of how vested interest sobotaged Ai from acquiring badly needed aircfaft replacements.
Around 1990s,civil aviation ministry proposal to provide funds for new craft acquisitions went to Public Investment Board (PIB) as required for all proposals involving Rs300+ crore investment.PIB delayed proocessing this and ultimately rejected this on the ground that such acquisition would enhance the value of AI and in the event of Govt wanting to disinvest in Ai,buyer would find it difficult to finacne such purchase. A very disingenious argument because the proposal was for funding new aircraft acquisition and there was no talk of AI disinvestment yet the funding proposal was stalled. This reduced AI fleet to 19 compared to 40 aircraft need and foregin airlines benefitted as they could operate flights where Ai should ahve operated.
The present Civil aviation minister the other day announced that heads would roll in AI if they did not perform.But he is presiding over it for more than 5 long years and appointed its chief from the civil services who had no ariline business experience and he was the one who gave preferential treatment to private airlines over AI. AI is gettinng internally and externaly sobotaged.
S.narendra
2. Internationally airline business is a fair weather business and most airlines have gone down and existing ones are struggling.Exceptin
4. There was no honest introspection on the way Pirvate players were running their business,mostly based on their egos and fanciful business plans.In 2005 Paris airshow these players competed with each other to fill the order books of the craft manufacturers.
5. Airtraffic grew not only becasue the economy was doping well but also becasue many had decided to acquire traffic by giving away seats free of cost.
6.If a business is not viable, you exit.
S.Narendra.
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Regards
BNK
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