The Government wants to take a deeper look at the crisis between the promoters of IndiGo, the nation’s largest airline
India’s aviation sector cannot seem to stem the tide of bad news. Even if this particular item does not question the viability of an airline, the very fact that the promoters of India’s largest airline are at odds with each other has the government rightly worried. IndiGo is a trusted brand and after the collapse of two major players over the past decade and the precarious financial health of others, we cannot deal with even a small airline’s demise, let alone any major snafu in the operations of a carrier that ferries almost half of the 10 million plus domestic air travellers every month. At the same time, IndiGo is one of India’s most valuable listed companies along with being one of the most valuable airlines in the world based on its share price, and thus it has also become a vital part of our stock exchanges. Both aspects are important to consider why even those in the highest echelons of government should take an interest in the dispute between the two promoters. The issues raised are prima facie serious, and different government agencies should take a long and careful look at this. However, the government and the Indigo management must make sure that this dispute does not impact the day to day operations as that could have a catastrophic impact on domestic air travel and the economy as a whole. The aviation sector has already undergone massive amounts of churn with the collapse of Jet Airways, now with almost no hope left of revival, as well as several safety related incidents over the past few months. The industry, the economy and the country don’t need a major crisis to engulf the nation’s largest airline.
The civil aviation sector in India could do with a spot of good news soon as the continuing closure of routes between northern India and Pakistan remains a problem which has now nearly gone on for half a year. The collapse of Jet Airways, with thousands of crores due to creditors, employees and in taxes, is far from being resolved. And the government is now adamant on divesting itself of Air India, at a time when the global and domestic markets are weak and the world is on the verge of a multilateral trade war. The spotlight on safety issues after a spate of runway overruns should also be a matter of concern to the industry as its global health continues to reel from the impact of the grounding of the Boeing 737 Max. Possibly the old adage, no news is good news would not be a bad place for the civil aviation sector to be in India right now.