Six decades after the Indian government divested the Tatas of their majority holding in Air India by nationalising the airline, the announcement by Tata Sons earlier this week for establishing a full-service carrier, in partnership with Singapore Airlines, with a combined investment of $100 million, has not only surprised the aviation industry but evoked tremendous interest.
The warm response to the announcement, which has the potential to be a major game changer, was only to be expected considering that it was the Tata Airlines that had heralded the birth of civil aviation in India in 1932. That previous attempts to enter the airline business had been effectively foiled by certain vested interests, prompting Ratan Tata to emphatically state that the Tata group was no longer interested in forming an airline, also add to the surprise element. Emotional factors apart, the announcement is bound to raise numerous questions in the coming weeks, particularly with regard to its positive and negative impacts on the Indian civil aviation industry.
While it is a foregone conclusion that the airline to be created by the two monolith business organisations -- one running a hugely successful international airline and the other having business interests across the industry spectrum -- will be a formidable one, a question that strikes one is whether the timing for entering the aviation sector is opportune.
Read News In Full 22/09/13 Jitender Bhargava/Economic Times
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