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Air India's Touchdown With Tata: Journey of the National Bird as it Returns Home After 68 Years

The Centre invited bids for disinvestment in the national airline in 2020.  (Image source: Twitter/Air India Express)

The Centre invited bids for disinvestment in the national airline in 2020. (Image source: Twitter/Air India Express)

The Centre announced that Tata Sons had the winning bid of Rs 18,000 crore to acquire the debt-laden national carrier Air India with 100% shareholding.

Air India returned to its founders, the Tata Group, after a gap of 68 years on Friday as the Centre announced that Tata Sons had won the bid to acquire the debt-laden national carrier with 100 per cent shareholding. Disinvestment secretary Tuhin Kanta Pandey said Tata had presented a winning bid of Rs 18,000 crore.

Last year, the central government had invited bids for strategic disinvestment in the airline. Four bidders had expressed interest, but only Spicejet CEO Ajay Singh and Tata Sons were shortlisted.

ALSO READ | Air India Disinvestment: Tata to Inherit India’s Largest Air Fleet - From Jumbo to ATR

Here’s a brief history of the Tata-Air India association:

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The national bird

Tata’s association with Air India dates back to 1932, when Tata Group founded Air India. However, the government nationalised the airline in 1953.

Nationalisation was hotly debated since Independence. JRD Tata opposed it on several platforms but was not invited by the government to present his views.

According to the book, Tata Group: From Torchbearers to Trailblazers by Shashank Shah, at a luncheon meeting with the then Prime Minister Jawaharlal Nehru in November 1952, he expressed his anguish that the government had intentionally treated the Tatas shabbily, and that it was a planned conspiracy to suppress private civil aviation, particularly the Tatas’ air services. Nehru reassured him of no such intention.

JRD’s contention was that the new government of India had no experience in running an airline company, and nationalisation would mean bureaucracy and lethargy, decline in employee morale and fall in passenger services.

To employ his expertise, the government invited JRD to lead Air India and Indian Airlines as chairperson.

The worst accident

On January 1, 1978, Air India’s first Boeing 747 plunged into the sea off the coast of Mumbai, killing all 213 passengers and crew on board.

A month later, the then Prime Minister Morarji Desai-led government dropped JRD from the chair of Air India and the directorship of Indian Airlines.

JRD, who was then at Jamshedpur, came to know of this development on February 3, 1978, from Air Chief Marshal Pratap Chandra Lal (Retd), who was appointed the new chairperson of both carriers.

In 1980, when Indira Gandhi came back to power as prime minister, she reappointed JRD on the board of both airlines, though not as chairperson.

He continued to serve on the boards till 1986, the year Ratan Tata was appointed chairperson of Air India by the then Prime Minister Rajiv Gandhi.

Push for privatisation

The attempts to privatise Air India had begun during the third term of the Atal Bihari Vajpayee government (1999-2004). In May 2000, the cabinet decided to sell 60 per cent of the government’s shares in the carrier. However, the process fell apart by early 2002, after the consortium of Singapore Airlines and Tata Sons fell apart and the other bidder - Hindujas - also withdrew from the race.

In 2007, the government of India merged Indian Airlines - the domestic carrier - and Air India.

The second major push for a privatisation took place during the first term of Prime Minister Narendra Modi. In June 2017, the cabinet “in-principle" approved a plan to privatise the airline. However, the government failed to attract any bidder for its 76 per cent stake in the carrier in 2018.

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first published:October 01, 2021, 13:56 IST