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“The recent downturn in the fortunes of Air India makes interesting reading. Amazing how Indian bureaucrats can screw a high-performing public-sector corporation in a short timeframe,” Lohani had said in a post dated July 7, 2009.
Back then, he aspired to pilot Air India to revival and that too within a year. But he always thought coming from a non-Indian Administrative Service (IAS) background would shatter his “dream”.
“If given a chance, of course, one year is all it would take for a turnaround even for a mammoth organization like the Air India,” Lohani wrote, “I am totally confident of doing the turnaround, but not being from the elite IAS is a big disadvantage in this country where these three letters take overriding priority over meritocracy. As one rightly said, dreams ought to remain dreams.” He further mentioned: “it would be real fun to turn this organization around and make it one of the finest airlines internationally.”
On August 20, Lohani’s dream came true as he was appointed as the Chairman and Managing Director (CMD) of the struggling national carrier Air India. It remains to be seen whether Lohani can turn around the fortunes of the airline in a year as he had claimed in July 2009 as a spectator.
Lohani’s LinkedIn profile describes him as “Mr Turnaround” as he claims he had revived the ailing India Tourism Development Corporation (ITDC) when he was its CMD in 2001-2002 and later, the tourism industry in Madhya Pradesh by leading the famous ‘Hindustan Ka Dil Dekho’ campaign.
In 2009, he criticized the national carrier’s decision to order planes in bulk during recession period. “Well the present outcome is borne out of consistent efforts of mass loot of the corporation by the bureaucrats in command and also politicians. Else how can one justify the large scale purchase of aircrafts during the days when the aviation industry worldwide was reeling under recession,” he had remarked.
In fact, a Public Accounts Committee chaired by BJP veteran Murli Manohar Joshi said in a 2014 report that poor planning of aircraft purchases led to the airline’s rising debts. In 2005, Air India had decided to purchase 68 aircrafts “despite several reservations, concerns and recommendations to the contrary,” the committee noted.
The committee was concerned that both Air India and the erstwhile Indian Airlines “did not identify benchmark market prices before initiating aircraft purchase negotiations with manufactures.”
In his blog piece, Lohani said another factor that could have contributed to the downturn was “large scale freebies to the top management.”
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Lohani is a man who wants a free-hand in taking decisions in order to turnaround Air India. He said the aim of the public sector is serving the society and “not the ministry officials and the ministry-in-charge.”
“Well there have been exceptions and the most notable that I experienced was during my shortlived stint as the CMD of ITDC in 2001 and 2002. The then Minister of Tourism who made me the CMD despite stiff opposition from the bureaucracy, let me totally free, while at the same time making it clear that I had his full support and backing. He not even once, during my entire tenure sought any favor from the corporation and that was one singular factor that led to a turnaround in an organization,” he said in another blog post on August 12, 2009.
According to news reports, after ITDC’s flagship Ashoka Hotel was taken off the disinvestment list, Lohani took it up as a mission for its revival. “Lohani took it as a challenge, and according to sources, the hotel was all set to make a profit of Rs. 3 crores at the end of this financial year, against a loss of Rs. 9 crores,” said a news report published in The Hindu on December 4, 2002. Then Tourism Minister Jagmohan was opposed to the disinvestment move despite pressure from the disinvestment ministry. The result: Lohani was repatriated to his parent cadre, the Indian Railways Service and no reason was given for his removal.
But clearly this time, the government is in no mood to give Air India in private hands as it is believed Prime Minister Narendra Modi closely tracks the finances of the airline.
Lohani believes that the unless the airline chief takes the lead, Air India will continue to fall.
“Air India is on the mat again. The problem is of inept CEOs who let the government down every time,” Lohani ‘tweeted’ in October 2013. He even said the leadership failure led to the poor finances of SpiceJet last year when it was almost on the brink of shutting down.
Can Lohani turn around the fortunes of an ailing Air India in a year? Let’s wait and watch.
