What is the trouble with Air India and who is the trouble-maker?

The workers of Air India have been waging a powerful struggle against the liquidation and privatization of Air India.

The different sections of Air India workers — pilots, cabin crew, ground handling staff, engineering staff have consistently exposed how the current CMD of Air India Arvind Jadav, and the Civil Aviation Ministry under the UPA-1 and UPA-2 governments, have carried out systematic sabotage of Air India with the aim of converting a profit making company into a loss making one. They have exposed how it is being liquidated and privatised bit by bit as a prelude to its complete privatization.

In the wake of these exposures, the government is now talking of revival of Air India. On the other hand, the capitalist associations are demanding its immediate privatization. They are saying government must not inject any money in Air India as it is allegedly a waste.

Union Civil Aviation Minister Vyalar Ravi held a meeting on July 6, 2011, with representatives of the Indian Commercial Pilots Association (ICPA), as well as the unions of the cabin crew, engineers and maintenance staff, ground handling staff, Commercial department workers, etc. According to the circular issued on the meeting by the ICPA, the Minister assured the leaders that the government and Prime Minister Mannohan Singh are very serious about reviving the company. He said a Group of Ministers meeting on Air India this week is expected to approve an injection of Rs 1,200 crores, as well as payment of another Rs 1,200 crores which the government owes to Air India, for flights requisitioned by the government. He also reportedly assured the leaders that the Maintenance and Repair Overhaul department would not be liquidated or privatized, as is widely feared by the engineers.

The first question is this — is the government serious about ensuring Air India is turned around? If it were, then it must first answer why the cumulative loss of Air India has risen from 475 crores to 60,000 crores over the past three years. It must answer why the market share of Air India, which was the largest three years ago, has dropped, and the total number of people flying by this airline has actually reduced, while overall passenger traffic by air has increased.

The purchase of Boeing 777 and 787 Dreamliners far beyond the airlines need is a major factor in this. There has been enormous wasteful expenditure in the company authorized by Jadav, including repainting of the planes thrice over with changed insignias. Lucrative routes have been deliberately handed over to private Indian and foreign competitors.  Private airlines have been deliberately given preferential time slots. The profit making  ground handling department has been handed over to the Singapore Company SATS. Deliberately, the pilots, cabin crew, as well as other workers are kept idle, as also the planes. Furthermore, through leaks in the corporate media over the past few years, both Arvind Jadav and Civil Aviation Ministry officials have declared that privatization is the only option, and the only question is how and when.

If the government were serious about reviving Air India, it would immediately pursue the course the Air India workers are demanding — reverse preferential treatment to private airlines, Indian and foreign, and greatly increasing the flying hours and destinations of the Airlines, so that its unused skilled labour as well as airplanes can be fully utilized. Furthermore, those responsible for the present situation must be brought to book, including the present CMD Arvind Jadav, who all workers believe was deliberately appointed to oversee the liquidation and privatization of Air India. (Arvind Jadav is also known as a man of Boeing, as the Raadia tapes have indicated)

There are no indications that the government is willing to reverse its course. In the absence of this, the injection of a small amount of funds now and then, means the government is playing for time, and waiting for an opportune moment to privatise.

Who is pushing for privatization and why?

The Airlines industry in India has been an extremely fast growing sector of the economy in the past 15 years. Air India has by far the largest fleet strength, compared to the private competitors, and it has enormous fixed assets, including highly priced land and properties, in India as well as in major cities of the world. Just the fixed assets of Air India will more than cover all the accumulated losses. Air India has a brand name which is recognized worldwide.

In such conditions, many players in India and abroad are eyeing taking over Air India. There is fierce dogfight amongst Indian capitalist groups to take over Air India and its assets. Ratan Tata is interested in it. So are the owners of Kingfisher, Jet and so on. International players including Singapore Airlines and Lufthansa are reportedly in the hunt. Lufthansa CEO Carsten Spohr has called for the privatization of Air India. The Secretary General of FICCI, Rajiv Kumar, has issued a strident call for the privatization of Air India in the Hindu of July 9, 2011. He is doing so on behalf of definite interests. Thus various Indian and foreign players are interested in gobbling up Air India after the government deliberately under rates its value, so that they can buy it cheap.

FICCI Chief's arguments for privatisation

The arguments offered by the FICCI Secretary General for privatization of Air India need to be understood and countered.

The FICCI chief has stated that "Its net worth, despite repeated capital infusion by the government, was negative". (According to the Air India management, the accumulated losses of Air India have gone up from Rs. 475 crores to Rs. 60,000 crores in the last 3 years.) The FICCCI chief is resorting to disinformation. Air India has being contributing to the government exchequer over the decades, just like other PSU's. It is not true that the government has been pumping in money into the company as an endless pit. The financing of the Boeings bought in these three years have been through bank loans at high interest. The FICCI chief has not explained how privatization of Air India would turn it from a company whose "net worth is negative" into a profit making enterprise. The reality is that the net worth of Air India is far from negative. As earlier pointed out, just the lands and properties of Air India, if sold in the market, would get it out of its financial crisis for several years. If its fleet strength and skilled labour was fully utilized, it could increase its market share enormously. It is precisely this that private Indian and foreign capitalists are eyeing. They want the government to deliberately undervalue Air India, buy it up cheap, and make huge profits. 

The FICCI chief argues that Air India does not cater to "some strategic needs". He says it does not "provide a public service to the under-privileged".

These same capitalists who are votaries of privatization have sought and got bail-out from the government on numerous occasions, including in the recent crisis. Were they bailed out because they were serving any "strategic needs"? Were they providing "a public service to the under-privileged"? No. The government simply declared that what was good for the capitalists was good for the country.

When Air India was nationalized in the years immediately after independence, it indeed was serving an extremely small section of society—the biggest capitalists, the ministers, and officials. It is in recent decades that Air transport within the country, and between India and other countries, has greatly increased. Now between 10 and 20 crore Indians have to use airways every year, and in fact, the size of our country demands a massive increase in cheap air travel all across the country. Large sections of the people using air travel are workers. Furthermore, there are many regions of our country which need even more air connectivity, at affordable costs, such as the North East, Odisha, etc. All this can be achieved only if the problem is viewed not from the narrow prism of maximum profits, as the FICCI chief is doing, but from the point of the general interests of society..

The FICCI chief advocates that private airlines should be paid money from a separate pool created by the government to ensure that commercially non viable destinations are serviced. He wants another pool created so that private carriers can do rescue and relief operations when people are stranded abroad. In other words, he is proposing that the cost of "strategic needs" and "public services", i.e. the loss making operations should be borne by the people, while the profit making departments should be handed over to private parties!  

As long as Air India exists, other private airlines cannot "rationalize" their workforces and become "globally competitive"!  The FICCI chief says this in so many words.  In other words, Air India is setting the standard in the industry and only if this standard is broken, can other airlines increase fares, intensify the exploitation of the workforce, and increase their profits, and establish their monopoly.

The workers of Air India have been repeatedly opposing these moves to liquidate the company and privatise it. They have been struggling to bring out the truth about the developments in Air India before the people of this country. For this they have been made the target of vicious persecution and victimization (SEE BOX 3), which clearly indicates the real aim of the government. 

The resolute struggle of the workers of Air India against these attempts of the government to liquidate and privatise it is thus a struggle that deserves the support of the entire working class of our country.