AI, IA merger has not progressed as desired: Ajit Singh

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Acknowledging that the merger of Air India and Indian Airlines has not progressed as desired, Civil Aviation Minister Ajit Singh has said some things had gone 'seriously wrong' in the process.

"Obviously the merger didn't go as planned, and there is something seriously gone wrong. My job is to see what is the current situation, learn from past mistakes and work to see that Air India succeeds," Singh told Karan Thapar in CNN-IBN's Devil's Advocate programme.

He said, "We all agree that the merger hasn't progressed or happened as it should have. But at this point of time we have to decide how to implement the Dharmadhikari report which takes care of most of these problems (integration of the human resources)."

Asked whether the airline management was not up to the mark in handling the challenge of merger, he said, "We are not here to indict the management, past or present. We are here discussing what the problems are with the airline. Merger didn't take place, we know."

To a question whether the government planned to privatise Air India, Singh said, "First, we have to put Air India on right track, make it viable.

"If you look around, the days of national carriers have gone. Any countries you look at, those days when national carrier was a reality, have gone. Those facts are before the government, our whole effort is to make Air India a viable entity."

On being pressed further and asked whether the government was making Air India viable to privatise it, he said, "At this point of time, we are not looking at that (making viable for privatisation)."

The Minister accepted it was difficult for the government to run a service industry like an airline where 'customer is king'.

"Top to bottom in a government PSU, in a government company, the culture is entirely different from what you need in the service industry," Singh said.

But, at the same time, he also said that most of the good public sector units were being run by the government servants and many private companies were in a bad shape despite being run by professionals.

Singh said both Air India and Indian Airlines were making profits till 2005 before the merger, despite being government entities.

"So, it's not impossible or beyond the realm of possibility that government can't run a service industry. Most likely it is difficult. Let's try the difficult thing," he said.

On the question of merger not taking place well and was half-heartedly or irrationally done, Singh said, "What I have come to know is that merger has taken place in about 70 per cent of the areas, marketing forces have been merged.

'But the key area of pilots, cabin crew and engineers, basically the human resource area, has not yet been merged. That's why Justice Dharmadhikari committee was set up' as the employees have different areas of operations, different pay scales, he said.

"There could be many other reasons for the failure. But if you look at other mergers in this area that have also failed," he said.