JOIN USThe Comptroller and Auditor-General’s (CAG) report on Air India, which was tabled in parliament last week, exposes the failure of yet another government department to protect national interests and a willingness within government to aid private, in this case foreign, companies to gain at the expense of the national carrier.
This willingness translated into decisions that hurt Air India which was even otherwise sickly. The CAG’s final report is more moderate than its leaked draft versions but raises many uncomfortable questions. The CAG reports on 2G spectrum allocation and on the Commonwealth Games had helped much to bring humungous corruption to public light.
The CAG had even taken pains to compute the national loss caused by the wrong spectrum allocation decisions. It has refrained from quantifying the loss in the case of Air India. It was within the purview and competence of the CAG to put a figure on the loss. If it had done so, it would have helped the nation to understand the financial impact of the wrong decisions taken by the government on behalf of Air India.
The impact could only be big. A proposal to buy 28 aircraft in 1995 suddenly ballooned into a decision to buy 111 aircraft in 2005 at a cost of Rs 41,595.6 crore. The plan, which was languishing for many years, suddenly became a buy order, securing all clearances within a few months.
The entire purchase was funded through debt. And instead of helping the airline make use of the increased capacity, foreign carriers were granted liberal rights to operate from and to India. This made sure that the airline would not be able to gain enough revenue to repay its debts. It was bleeding because of a number of other reasons, for which also the ministry of civil aviation was mainly responsible. The purchase of aircraft and the creation of circumstances that made it impossible to recover the cost ensured that the airline was fatally hit.
The political and official leadership of the civil aviation ministry of the time when these decisions were taken should answer the questions raised by the CAG report. There are records that show that the responsibility for the decisions went beyond the ministry too. The CAG’s findings should be followed up with more investigation, and it is bound to unravel another big-time corruption scandal. The government’s argument that all due processes were followed is inadequate defence.