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'Privatisation will resurrect Indian Airlines'

While there has been scepticism on the future of Indian Airlines after the Cabinet's decision to revamp it, aviation experts and airline officials feel that the move will help in giving a fresh lease of life to the cash-strapped domestic carrier.

Indian Airlines faces a stiff battle from private airlines as well.

Describing the decision as a 'breath of fresh air', aviation circles said the financial restructuring package means that Indian Airlines will be able to afford a new look.

It will also fulfil the long-pending desire to procure new generation fuel-efficient aircraft to face the competition from private airlines.

The Cabinet Committee for Economic Affairs' nod to Indian Airlines to mobilise funds through an initial public offer or any other modality available for its restructuring has come at a time when private airlines are once again trying to fly high and consolidate their reputation.

Indian airlines has been trying very hard to increase its domestic market share. Indian Airlines's share in the domestic market has risen to 58 per cent in May, a jump of six per cent since January, according to IA officials.

''By working diligently, the civil aviation ministry and Indian Airlines have demonstrated that it is possible to increase the domestic market share. Should such a momentum continue, the airline will be able to increase its market in domestic and international (the Middle East and Southeast Asia) operations,'' an airline official said.

The official claimed the 42-44 per cent market share of the private carrier Jet Airways has now dropped to 35 per cent while Sahara Airlines, which has ambitiously slashed fares, has only about seven per cent.

Civil Aviation Minister Ananth Kumar's aim to restructure the two national carriers and the Vajpayee government's decision to revamp Indian Airlines are in line with the long overdue recommendations of the Kelkar Committee's report. The report has been gathering dust since 1995.

Although doubts are being raised on the implementation of the Rs 3.25 billion financial package, civil aviation ministry officials say that it will all be worked out in the best interests of the airline. The aim is to make IA operationally and financially viable and passenger-friendly.

Airline officials claim that the CCEA's decision to raise a sum of Rs 7.10 billion by disinvestment through public issue and sale of shares to airlines has boosted the morale of the domestic carrier.

Indian Airlines has recently started the refurbishment of its ageing aircraft to give it a new look and also launched a series of programmes to attract more passengers.

UNI

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