All the Maharajah�s Men

Abstract

In the early 2000s, the national air carriers of India, Air India (operating international air services) and Indian Airlines (servicing domestic routes and neighbouring countries) were facing a financial crisis following a slump in the aviation sector worldwide due to global recession and rising fuel prices. In 2007, the two airlines had been merged in a bid to galvanize their fortunes but the merger had not been successful. Expensive fleet acquisition, sale of bilateral air traffic rights in favour of private and foreign carriers and attempted integration policies in the course of the merger resulted in mounting losses and debt for the company. The leader of the airline’s largest trade union sought to work with a newly-appointed, socialist Minister for Aviation to garner government support to save the airline through capital and equity infusion. The alternate options to government aid were privatisation or a shrinking of the airline. The government had occupied an ambivalent stance and public support stood against the airline’s favour. Given the political scenario, the strategic importance of the national carrier and the ailing aviation scenario of India itself, how could the merged national carrier be saved?