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Rahman at CIC Eternal support for capitalisation of PS banks Fortune for Indian Airlines Which side are you, Montek? A yen for wastage… Quality education through the PPP mode WTO Meet: resolved to meet again No Maha Koottani in TN... Adharma of opposition politics EVM is tamper-proof Inflation: are we emulating Argentina and Brazil? Gas is the way forward The brown list of Venkitaramanan Whistle-Stop Tour of Raghuram Rajan Not just in-laws (and outlaws); they’ve renowned academics at the helm! IPL type auction for VCs? Varuna (rain) in 2015; Vaayu (air) in 2016. Chennai devastated He continues the focus on social amelioration Welcome focus on core competence The ‘Jayanthi Tax.’ A professional at the helm of IRDA... A Grand Finale for SN’s MS centenary at the US… GNS - 100: our first subscriber A proud Madrasi Land reclamation from sea appears cheaper! 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This despite the much lower costs of such research in India. The industry which thrived on the protection of a closed economy and the advantage of a vast domestic market, has failed to organise its evolution on healthy lines CIPET hqrs to stay at Guindy – for the present? Tihar, Puzhal not different from Parappana Agrahara Where a state respects its litterateurs… Solar thermal shines… TIAM turns a full cycle Cleaning Ganga – relocate tanneries and install electric crematoria An informal presentation - analytical, forward locking... 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Computation of GDP – conundrums continue PC’s preference for professionals Mersal magnified Chennai and Kolkata miss opportunity to grow as Delhi and Mumbai Robber barons everywhere CII projects higher growth… S V Raju – a ‘good’ true liberal Quality silica from Neyveli No mega rail project for Tamil Nadu Boy, can you beat these? More heat than light Bihar – Nitish Kumar adopts the Lalu model L&T: focus on infrastructure and more infrastructure… Tribute – M V Murugappan Make standards certification mandatory... Lesson from Chandrababu Naidu When TN politicians can emulate Kerala's Tough task taking states together An enemy’s enemy is a friend Tribute – Manikam Ramaswami Russi Mody – a tribute How Air-India loses customs... Multi-faceted Venkat Banning booze... A C Muthiah – his munificent bequeaths to science Welcome thrust on trade in Modi’s foreign visits... 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A more liberated TN… Rs.1600 crore paper board plant of TNPL The sea- saw battle continues... Why this malaise in medical education? TGS- The king storyteller Parliament in paralysis... More Shakthi to Das’ elbow The why of tax incentives The Jan Dhan bonanza Breaththrough in malaria control Shaming of Tamils by Tamil farmers at Delhi The power-full Hindujas Streamlining mandatory third party cover …and of a popular trade leader Adapt Vajpayee dinner diplomacy Protest masters... Medical costs hit the roof... Mu Sigma – is no more Delhi is distant… Editor's Notes When online building permits work…. Should we change the official year? London, London Narayan Poor quality of university VCs Readers' Mail Kudos to NDTV... The nuclear option There was flood of milk. Reason: no milk commissioner! For whom the MIDS bell tolls? Kinetic Karnataka Where is Rajaji? Noble nonagenarians... More tributes to GR Towards speedy justice Road development slows down TN-leverage strength of BHEL, NLC... Small units prefers to remain small... Paytm karo... The Ports’ Pasha expands into Tamil Nadu An inexplicable neglect This scant respect for Law MHC should not return to its old indisciplined ways Delhi is distant TN – agglomerate land holdings without alienating ownership Things happen by accident and not by design... Moily’s bold thrust Diamond jubilee of Egmore Samskrt School Plummeting profits of PSBs Odisha: spectacular win by Naveen Patnaik No engine for this car Silver Years of Madras Musings TELANGANA at last…BUT Delhi returns to BJP The balancing act Tax agriculture Kulandai was a giant Haul over the coal He saved millions from starvation... Revive development banks... Godspeed, Chief Minister JJ
 
How Air-India loses customs...

I have in the past mentioned the failure of the national carrier Air-India to derive the maximum benefit out of the boom in air travel. Post the 1990s the massive increase in traffic was initially grabbed by the European giants like Lufthansa and British Airways. Surprisingly, despite bulk of this traffic moving towards the US, large American airline companies have not tapped this business. They have been content to leave the huge potential to be exploited by their partners in the airline alliances like Star Alliance.

After 2000, synchronising with the improvement in technology to fly over long distances with bigger aircraft, countries in the Gulf region focused on the airline business. These countries created productive infrastructure on the ground and invested massively in sophisticated aircraft.  With vast areas of land available in these desert kingdoms, in quick time sophisticated ground facilities were created. In quick succession Emirates, based in Dubai, Etihad in Abu Dhabi, Gulf Air in Bahrain along with their older counterparts of Saudi Airlines and Kuwait Airlines, have been investing massively and winning handsome custom. With much lower airport landing and takeoff costs and with the ability to fly non-stop over long distances, these airlines have been able to earn a lot of custom from Indians travelling to the US, African and European countries and other destinations.

Mounting losses with the consequent inability to invest continuously in the acquisition of new aircraft in large numbers, Air-India has been missing out this boom. Many of the bilateral agreements with several nations have been benefiting its partners and not so much Air-India. The corporation is yet to come out of the effects of its merger with Indian Airlines, loading it with an enormous under-employed workforce, diversified aircraft and ineffective management with bureaucratic control. Its once huge market share within the country has suffered severe erosion. With the recent new policy that permits newer entrants in the business to fly overseas, this competition is bound to intensify further.

Despite the large custom from South India, Air-India doesn’t offer direct, non-stop flights to Europe/US. The passengers are ferried to Delhi/Mumbai for such direct flights entailing higher travel time.

The policy of continuous recapitalisation by the government has mostly gone to keep the airline afloat. A bold new plan to revamp the finances and infusing substantial fresh capital can still enable this Indian icon to regain some of its past glory.

 

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