The Hindu Business Line : <I>Merger in the air? </I>

There are only rare instances in the last two decades when the Civil Aviation Minister of the day has not talked about a merger of Indian Airlines and Air India and, as is obvious, it has never happened. In the present circumstances, when competition is at its peak, consolidation of assets could probably be a positive move. But the reasons why such merger moves failed in the past still remain.

Unlike the Jet-Sahara deal, a merger of Air India and Indian Airlines would throw up almost insurmountable HR problems. First, both airlines are over-staffed. Second, almost every employee in each airline has a counterpart in the other that could lead to redundancies. Unlike the private players, shedding staff in the public sector is not an easy proposition. Third, reorienting the work culture of the nationalised airlines to conform to competition would be an equally arduous task.

So why then the grand announcement by the Government that the two flag carries would be merged this year itself? The grapevine has it that having announced a merger and acquisition policy for the aviation sector which would smoothen the way for the nearly `grounded' Jet-Sahara deal, the Government was eager to show that the M&A policy had not been framed for the private sector alone. Rather, it was worked out keeping in mind the IA-AI merger. Any bets on whether the merger would actually come through?

Airports modernisation

Sticking to aviation, has the Government finally mustered enough courage to disregard the Left parties when it comes to privatisation? It seemed so this week when the agreements between the Airport Authority of India (AAI) and the two private parties that have been selected for the modernisation of the Delhi and Mumbai airports were signed.

Having come to know that the agreements were to be signed on Tuesday, trade unions and the Left parties utilised the weekend to protest the move. Since the deal was to be sealed on Tuesday, Monday was the only intervening day and they anxiously waited for a call from the Prime Minister's Office for the meeting. Till late afternoon, the Left leaders maintained that they were waiting for the appointment, but by evening, the Prime Minister's Office confirmed that no such meeting was on the PM's schedule that day. Worse, the Civil Aviation Minister, Mr Praful Patel, made himself scarce from the capital for the whole day. The deal went through as planned on Tuesday.

Taste of discipline

Corporate India got a taste of military discipline early this week, but it was not totally unwelcome. At a conference organised jointly by the Armed Forces and the Confederation of Indian Industry, people were pleasantly taken aback when, at the conclusion of the pre-lunch session, an announcement was made that "those in the first five rows, please turn to the left for the lunch. The remaining five rows would kindly turn to the lunch laid out on the right side." The orders were followed with military precision. But there is a flip side to it too as the CII learnt. The sessions on Internet and its use in warfare addressed by top military brass were so couched in technicalities that it went over the head of many a scribe invited to report the event.

OUR DELHI BUREAU

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