New Delhi:
Air India may have got a bailout package of Rs 1200 crore from the Government but Civil Aviation Minister Praful Patel made it clear that he felt that the National Carrier was carrying dead weight.
Speaking to NDTV he said that, "Air India systems hadn't changed with the changing time... the left hand doesn't know what the right hand is doing... the only way this could be changed was with a serious shake up."
Following is an excerpt from that interview
NDTV: Now one of the things that the Air India management has been repeatedly speaking is about how they need the equity in future because they are borrowing it at a very high rate and they are saying that if the Government were to provide them Rs 1200 Crore equity infusion then it would save them about Rs.1000 crore per annum. Is this something that you believe is a reasonable demand and can we see any possibility of this happening?
Patel: See, absolutely one thing has to be understood that Air India is the national carrier and will continue to be the national carrier and there is no doubt in my mind, there are different views which always keep coming up that you should privatise Air India, you should do this with Air India, fine.
NDTV: But you have had some resistance from Finance Minister and the Home Ministry?
Patel: No, I don't think that those issues need to be publicly discussed, they are minor issues.
NDTV: Have those obstacles been crossed?
Patel: Of course we have, I have spoken to Finance Minister who was quite objective and positive. The issue about Air India is one must understand, that it was once the lone carrier of the country, when competition comes definitely everybody's market shares starts declining. People should look at Air India and Indian Airlines as one entity then.
Has Air India, Indian Airlines grown since 2004 or not. In 2004 the Air India and Indian Airlines combined had less than 75 aircraft. Today, both of them combined have more than 120 aircraft. Their capacity has increased, their reach has increased. When competition comes naturally your share in the pie will shrink because there are more entrants. Jet Airways enjoyed 60% market share only about five years ago and now Jet Airways' market share is 25% so it's not that Jet Airways has shrunk neither has Air India shrunk, the pie has grown bigger.
The real issue for Air India is, and which I feel sometimes that pains, is that we have not been able to, I mean we as I say the entire system of Air India the people of Air India have not been able to change according to the times and that is what sometimes you know. It's sometime unfortunate that left hand doesn't know what the right hand is doing.
NDTV: You said that in an interview last week. What does that mean? You didn't elaborate it. Are you saying that it's badly run?
Patel: No, I feel that... yes there is a lot of shaking up to be done in Air India and I can assure you that now Parliament is over and I'm seriously looking at it.
Speaking to NDTV he said that, "Air India systems hadn't changed with the changing time... the left hand doesn't know what the right hand is doing... the only way this could be changed was with a serious shake up."
Following is an excerpt from that interview
NDTV: Now one of the things that the Air India management has been repeatedly speaking is about how they need the equity in future because they are borrowing it at a very high rate and they are saying that if the Government were to provide them Rs 1200 Crore equity infusion then it would save them about Rs.1000 crore per annum. Is this something that you believe is a reasonable demand and can we see any possibility of this happening?
Patel: See, absolutely one thing has to be understood that Air India is the national carrier and will continue to be the national carrier and there is no doubt in my mind, there are different views which always keep coming up that you should privatise Air India, you should do this with Air India, fine.
NDTV: But you have had some resistance from Finance Minister and the Home Ministry?
Patel: No, I don't think that those issues need to be publicly discussed, they are minor issues.
NDTV: Have those obstacles been crossed?
Patel: Of course we have, I have spoken to Finance Minister who was quite objective and positive. The issue about Air India is one must understand, that it was once the lone carrier of the country, when competition comes definitely everybody's market shares starts declining. People should look at Air India and Indian Airlines as one entity then.
Has Air India, Indian Airlines grown since 2004 or not. In 2004 the Air India and Indian Airlines combined had less than 75 aircraft. Today, both of them combined have more than 120 aircraft. Their capacity has increased, their reach has increased. When competition comes naturally your share in the pie will shrink because there are more entrants. Jet Airways enjoyed 60% market share only about five years ago and now Jet Airways' market share is 25% so it's not that Jet Airways has shrunk neither has Air India shrunk, the pie has grown bigger.
The real issue for Air India is, and which I feel sometimes that pains, is that we have not been able to, I mean we as I say the entire system of Air India the people of Air India have not been able to change according to the times and that is what sometimes you know. It's sometime unfortunate that left hand doesn't know what the right hand is doing.
NDTV: You said that in an interview last week. What does that mean? You didn't elaborate it. Are you saying that it's badly run?
Patel: No, I feel that... yes there is a lot of shaking up to be done in Air India and I can assure you that now Parliament is over and I'm seriously looking at it.
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