Raison d'être for continuance of the Public Sector

Two conclusions emerge from Air India’s statement: One, passengers booked on Air India flights should now know that they could be put on to other flights if the airline gets a request for a charter operation and the airline will inform the passengers concerned in advance about the change in schedule which according to the airline would mean there is no inconvenience to the passenger.

Their fate could be like that of the passengers booked on Delhi-Coimbatore flight IC 7603 on April 20 who were flown on Delhi-Mumbai-Coimbatore flight IC 657 to accommodate the IPL charter flight. The fact that they reached their destination three hours later would be considered unavoidable as the flight diversion would be in the commercial interest of the airline.

Jadhav has also said, "Air India has not violated any of the rules governing the flight operations by this service." That leads to the second conclusion: that the DGCA’s Civil Aviation Requirement, Section 3, 10.2 which pertains to Air Transport (effective from March 1, 1994) and states that, "Scheduled operators (airlines) can conduct charter/nonscheduled operations for transportation by air of persons, mail or goods provided such flights do not change their normal approved operating schedule’’, does not apply to Air India.

For the full report in the TOI, click here.

This is exactly what happens when the goverment becomes a player, instead of remaining just the facilitator and regulator - there's no longer a level playing field - check this

 

The Reason or justification for BTS a public road transport organization monopoly is perhaps justifiable as the city roads are a public property.

Air is also public property

If private transport busses are allowed to compete with BTS busses there could be a chaos on the existing road net work of the city.

And, the proliferation of private players is cluttering the air-ways across the country - so why not go back to the good old days of Indian Airlines monopoly? And, more

 

@Ananthram - RWH is being discussed under quite a few other posts. Why do you bring the matter here, please?

Likewise, bus services monopoly issue has been discussed at length, rather ad nauseum, here, apart from a number of places elsewhere. It would have been better if you had placed your comments in one of those, and linked it to a short comment here.

@ Naveen - Haven't we gone through all of this before, please - like in the post linked above? There's clearly no agreeing between us on these issues. So, why don't we just agree to disagree, please? And, again, apart from the  comment "Many private airlines have also been fleecing the public - these sort of complaints are not confined to AI or IA alone", the rest would have been better of posted elsewhere.

And, as for 'fleecing the public', please go on to 'yatra.com', or any flight booking site and see who is offering the best fares.
 

@Ananthram
Air India as a Public sector undertaking is there to stay in simple English.

AIR-INDIA's privatisation is inevitable, whether you support it or not - take a look at this

The point I have made above is that Air India rule book needs to be amended, (as regards charter flights).

It's already there in the DGCA mandate, and the AIR-INDIA rule book has definitely to conform to that. The question is of keeping to the rules. Whereas, when the government carrier does it, the DGCA is forced to look the other way, but if a private player does it, the MD will perhaps find himself behind the bars (as it should be).

@Naveen
However, I agree broadly that with private airlines operating now in India, people have some choice & one can choose a flight based on preferences & to suit different pockets.

That quite sums it up. Healthy competition alone is what can make the difference, including in public bus services.

Incidentally, on the question of safety, over the last one week (including today), not a day has passed without one reading about some accident or the other involving BMTC/ KSRTC buses, many of them involving fatalities - yes, that's a separate subject

@Pathy Sir & IDS
Let's move the "PRAJA bus services" - check this. It's a huge opportunity at social entrepreneurship
 

He alleged that the factory’s land has been sold to 53 individuals so far.

“According to the information obtained by the association through RTI, the land has been sold at Rs 200-400 per square feet while the market price was Rs 2,000 per square feet  between 2004 and 2006. It’s rate stands at Rs  4,000-5,000 now,” he charged.

The former employees of the factory also pointed out that HMT’s internal inquiry had found former Chairmen Ramanujam and Zahid had misappropriated funds to the tune of `550 core through the land sale. They demanded that they should be brought before law immediately.

For the full report in the New Indian Express, click here.

HMT, ITI, AIR-INDIA, etc are very much serving the only purpose they exist for today - lining the pockets of neta's and their cronies.

Privatization of Air India could be considered if there is political consensus, aviation minister Ajit Singh said on Saturday. He indicated that it may not be possible for any government to keep funding AI beyond the existing Rs 30,000 crore package spread over nine years.

- - - - Asked will AI get an investor when Kingfisher with a much smaller debt and losses (compared to AI) has not been able to get one so far, Kaul (chief of CAPA - Centre for Asia Pacific Aviation) said the two airlines are very different.

"Kingfisher has been grounded for over a year now. AI is fully operational and has the single-largest market share in international traffic apart from close to 20% share in domestic air travel. AI has huge infrastructure, fleet of 115 planes, pilots and other technical staff. If the government supports a private player, AI can surely get suitors even now," Kaul said.

To read the full text of the report (which is well worth the effort) in the ToI, click here.

Perhaps too late now - the liabilities are far too high, and rapidly mounting. The only way out appears to be to shut down the operations right away, cut the losses by auctioning all the assets, and write off the balance.

The moral of the story is for the government to get out of all services and manufacturings, and stick to its job of governance.

@ Sanjeev - So, who should be held accountable for all the wrongs at the BIAL, other than the State and Central governments? Whereas, as the major PPP stakeholder, the State government should have been safeguarding the interests of the citizens, it, led by the then CM, was more interested in using the opportunity to help various neta's line their pockets - another case of "crony capitalism", like the many we have been seeing all over. Further, it is only now, in 2013, that the Central government has notified the "Airports Economic Regulatory Authority" bill, which was drafted in 2008. If the two had played their assigned roles properly, everything would have gone fine.

For all of that, BIAL is still amongst the best of airports in the country. Only, the costs have shot up, because of the commissions and omissions of the government agencies involved, and eventually it is the travellers and tax payers who are having to shoulder the burden.

All of these add upto the point I (and, a few others - notably blrpraj - check this) have been repeatedly making - that governments should be concentrating on facilitation, and regulation (and control, where essential), rather than on providing services and undertaking manufacturing, by themselves.

Let's make no bones about it - the private sector operators are there only to maximise their share-holders' wealth, and that is how it should be, as long as they are playing by the rules and paying their taxes. And, any societal good they may want to do, they term them as CSR (corporate social responsibility). As compaed to that, the raison d'etre of government is social responsibility. Further, Corporates are no Harishchandra's, and if governments fail in their roles as regulators, don't expect them not to exploit the opportunities presented.

PPP's, thus, could be the ideal vehicle for maximising shareholder (amongst which can even be the state) value, through the technical and financial expertise of the Corporates, as long as the state (as the partner) does its job of safeguarding citizen interest, properly. The state's role is thus crucial.  And, the Civil Society (alongwith the media)'s biggest role is to keep a check on the state.

@ Sanjeev - What is the point being made here? Is it that the private sector too isn't faultless? But, who ever is saying that? In my earlier post itself, I had stated that they are no "Harischandra's". And, here is another recent example of my helping to expose the unsavory deeds of a builder. There are plenty more on PRAJA, including my winning a favorable award from the Consumer Court in a case against AIRTEL (here).

So, if you want to bring up issues pertaining to BIAL's misdeeds (as you may want to see them), do start another blog.

Besides, here again, as in most of BIAL's "misdeeds" (i'll not call them that, though), the culprit plainly is another government agency, viz AAI, as becomes evident on reading the following line: "The project began to falter once the Airports Authority of India (AAI) issued its No Objection Certificate (NOC) for a building height of only 30.35 meters from the ground level, way below the 45 meters specified under the original bid".

Now, the whole thing is stuck. Please understand that such large private sector infrastructure projects getting stuck harms the economy considerably too, in very many ways, and is not quite a happy augury.

Misuse of government funds can only be described as corruption. Union civil aviation minister Ajit Singh and steel minister Beni Prasad Verma stand accused of misusing government funds for political purposes. In both cases, the modus operandi was the same—force the public sector undertakings under their command to spend a major portion of their funds meant for corporate social responsibility (CSR) on the development of their constituencies.

For the full text of the editorial in the New Indian Express, click here.

As long as you have the "public" sector, they will be put to the "private" uses of the neta's.

Chief minister Siddaramaiah is facing the wrath of the Congress's rank and file over the year-long delay in reconstituting the 110-plus boards and corporations. These are statutory bodies where the chairman's post is equivalent to that of a cabinet or a minister of state in rank. These help the ruling party to dispense political patronage and keep its party leaders in good humour in addition to accommodating MLAs who couldn't be fitted into the cabinet.

- - - According to party sources, there are about 110 boards and corporations and other bodies such as urban development authorities. It's estimated that, in all, the government can accommodate about 1,300 positions like chairman/vice-chairman, members/directors, which could be filled with non-officials.

For the full text of the report in the ToI, click here.

It's over a year since this ministry took charge. All it has been bothering with is furthering more and more of its Socialist agenda, through various kinds of "bhagya's", and running the state treasury dry. This is even as the erstwhile Congress (MMS) government at the centre, had sought to reverse them, realising the damage it was causing, not just to the country's economy, but even to its own re-election prospects, and the realisation coming rather late, paid the price for it. Apparently, this ministry and the party haven't read the message sent out by the electorate clearly, and their members are only bothered about cornering the biggest loaves of office for themselves.

Meanwhile, our power, water, bus services, garbage management, in fact the entire infrastructure, is just crumbling. Perhaps, it's time we helped ease out this this (non)-government.

NaMo has said "less government; more governance", and from all indications, he's pursuing that line too. May be we too could do with Modi-fied BJP rule, as compared to the earlier Yeddi-fied one.

The government has decided to shut down 15 loss-making public sector units, of which at least five have been cleared by the cabinet, while opting to go against internal advice and revive three state-run companies.

Sources told TOI that there were another half-a-dozen sick public sector companies, which had been identified by NITI Aayog for closure, but their fate remained uncertain amid hectic lobbying by ministries, which want to keep them alive in what may be an effort to protect their turf.

- - - Out of 74, the Aayog had suggested status quo in case of two PSUs, strategic disinvestment of 10, plan for revival with option for strategic disinvestment for 22, transfer of ownership of six, merger of three, long term lease of five and closure of 26.

For the full text of the report (emphasis added by me) in the ToI, click here.

"Protect their turf' to what intent is what is debated in this blog - very clearly it's not altruistic; but, on the contrary, plainly serving the vested interests of a small coterie whose fiefdom these have become. Instead of vacillating endlessly, it's time Niti Ayog moved on, and perhaps time too that the tax paying public, on whose hard earned money these parasites feed themselves, demanded it, and from the rooftops.

The Bengaluru Metropolitan Transport Corporation has initiated process of procuring new buses after a gap of more than two years. BMTC managing director Ekroop Caur said the board approved a proposal to purchase 2158 buses.

- - - Caur said the state government allocated funds for procurement of new buses in the current budget and she urged the state to set aside some more in the next budget to be presented in March.

Speaking on the occasion the BMTC chairman M Nagaraj Yadav said the board had approved a proposal to take up welfare measures for employees.

"We have proposed to build a super specialty hospital for the BMTC employees. Setting up of digital libraries and clinic at traffic transit management centres (TTMC) are among other measures proposed," Yadav said.

For the full text of the report (emphasis added by me) in the ToI, click here.

In the first place, the BMTC is hard put to find resources for replacing its aging fleet. While one would have thought that the politico's in charge would put all their efforts into addressing that problem, what one finds instead is their concentrating on building TTMC's wherever there is any vacant space in their possession, whether it fits into their overall operational scheme or not. Even worse, like in Koramangala, it has meant all the buses getting parked overnight on the main roads,  with the depot space now being occupied by a massive TTMC (check here), this then becoming a major impediment to regular traffic flow. And, for all of that, apparently, most of the TTMC's are half empty, the resulting unmet loan (and interest thereon) burden becoming another drain on BMTC's resources.

And, as if all of that was not bad enough, now a Chairman gets appoinited, plainly due to political compulsions, adding so much more to BMTC's already unbearable burden. And, to top it all, this worthy wants to build a super speciality hospital (it's not as if there are not enough government hospitals already, but, yes, this largely is their state; and another government run hospital can't be any better), nothing less, exclusively for the employees.

The fact of the matter, very obviously, is that TTMC's, hospitals, etc mean massive building contracts, and thereby the pursuit of such objectives. Commuter facilitation, employee welfare etc are plain cover-ups.

It's time the people woke up to this reality in all such pursuits in the PSU's, and demanded the eventual shutting down all of them. As long as they remain government-owned, there's no way of preventing political interference.

In the case of bus services, first and foremost, the demand needs to be for the opening up for competition from reputed private players (check this), under the overall oversight of the UMTA.