Thanks to circumstances, we now have not one, but two domestic airlines available in a fire-sale. One collapsed financially in April and is now at the bankruptcy court (Jet Airways), and the other is on life-support but still flying – Air India. That both are on the block at the same time can be directly linked to the general elections. The Modi government did not want two political time-bombs going off together before an election. The Air India privatization was put off indefinitely after it drew a blank in May 2018, and the Jet Airways rescue effort was left to simmer aimlessly for months. Once the elections got over, it took no time for the bankers to pack Jet off to the National Company Law Tribunal (NCLT).
Kicking the can down the road, though, does not mean we are now going to get quick progress on either. Civil Aviation Minister Hardeep Puri announced last week that the government will go ahead with the Air India disinvestment, but with Jet also now available for purchase, the government will actually have to choose between two options – whether to push Air India’s sale hard with a better offer to suitors, or to get Jet flying again within the three-month resolution time set by the NCLT. Read More