My last post ends the narrative of my career in Air-India and future posts will show a career turn.  I may, at some time,revert to this Blog if the situation so warrants.

I was deeply saddened to learn that Ajit Singh passed away a few days ago.  Saddened not only because the passing of a former colleague leaves a big void in one’s life, but also the fact that my association with Ajit went back beyond my Air-India days.

If memory serves me right, when I first met him, Ajit was working for Indian National Airways in their office at Maholtra Building in Connaught Circus, New Delhi.  I was introduced to him by my brother-in-law, O.P. Lumba, who was then working for Bharat Airways. This was before the many domestic airlines were nationalized and combined into Indian Airlines.  So, I am talking about the early 1950s.

I had at that time, finished my schooling, but had not yet graduated from college. By the time I joined Air-India in 1957, Ajit had moved to KLM.  I was delighted when Ajit joined Air-India and we became close colleagues.  Even after I left Air-India and moved to the USA, we met whenever I visited India and particularly, when he got involved with organizing the annual AI retired executives lunch.  Many a time, we had dinner the night before at his residence, where I met other colleagues who were staying with him on that occasion.

Ajit was a great socialite.  He formed a number of small groups comprising persons with whom he had worked and he made it a point to invite me to their gatherings whenever my visits to India coincided with their meetings.  Two such groups readily come to mind.  The first was his former Indian Airlines colleagues and it was a true pleasure for me to renew my acquaintance with some of them.  The second was a mix of travel industry personalities, such as Gautam Khanna and Dilip Mitra.

The world will  become smaller with Ajit's leaving it.  He is the second of four AI colleagues whom I knew prior to my joining the airline, who has left this world; the first being SK (Gulu) Gulati.  

In my Post of September 4, 2016, I had spoken of the “elevation” of the current CMD of Air-India to the grade of a full Secretary to the Government of India.  I quote below an extract from this Post:

“Air India chairman and managing director Ashwani Lohani has been empanelled to hold secretary-level posts in the central government.  - See more at: http://www.governancenow.com/news/psu/air-india-chief-ashwani-lohani-empanelled-as-secretary#sthash.nyxVKZmS.dpuf”,

In the same Post, I spoke of the new routes that AI had embarked upon, which in the opinion of some (I quoted extracts from the media) and myself, it would appear that orders came from “above” and immediate action was taken to introduce these two routes.  I went on to ask “Is this an autonomous Corporation or an arm of the Government?  From what is stated in the foregoing paragraphs, I guess the latter.”

I added that in my view, sycophancy continues to live and flourish in the Modi Raj just as it did in the Gandhi Dynasty Raj and that the CMD’s elevation in grade must have been a “reward” to Mr. Lohani for accomplishing the objectives of the P.M? 

I was, therefore delighted to read the CMD’s interview with Anirban Chowdhury and Satish John (Economic Times - Jan 7, 2016) in which he came out strongly in favor of outright purchase of aircraft as opposed to leasing.  Here is what he had to say (in Italics):

“What we also, however, did was we got into sale and leaseback deals (which didn’t work well). Interest or finance costs on debt (when aircraft is purchased) come below the line of operational expenses. But lease rentals accrue as operating expenses. That is what has impacted our operating profits for the first two quarters. 

We, however, hope to post an operating profit for this year too as September to March is a much better half of the year.” 

Are you saying the sale and leaseback model hasn’t worked for Air India? The entire industry swears by it. 

“Leasing of planes is a very costly proposition. It has the advantage of not having to pay upfront. But the amount which a company pays regularly (as lease rentals) is much higher than what it would have to pay had it purchased the aircraft by taking a loan. 

The premium on selling planes to lessers is not much, just a couple of million dollars. The lease cost of one Boeing Dreamliner 787 plane is $1 million a month. For a year for 21 Dreamliners, it’s Rs 1,800 crore. If I had purchased, my outgo in terms of interest costs on loans would have been Rs 1,000 crore. 

Going forward, I would definitely do outright purchase of planes.

What we also, however, did was we got into sale and leaseback deals (which didn’t work well). Interest or finance costs on debt (when aircraft is purchased) come below the line of operational expenses. But lease rentals accrue as operating expenses. That is what has impacted our operating profits for the first two quarters.” 

There are talks that Air India is looking to buy back the same Dreamliner planes that it did sale and leaseback deals on? 

“We would definitely like to do that as it reduces the servicing cost to half or even 60% -- it's still being debated.” 

The foregoing question and answer session gave me hope that finally, this Management is developing a backbone and that it will take decisions independently and not accept diktats from the Ministry or the PMO.

Guess what, not even 10 days later (see the Times of India article by Saurab Sinhal on Jan 16, 2017) where the Aviation Secretary is quoted as saying:

“NEW DELHI: The government has decided that Air India will almost double its fleet by adding over 100 aircraft, but without burdening the exchequer with a mammoth debt burden like last time. The airline will grow by leasing aircraft instead of purchasing them — the model adopted by Congress-led UPA.

"AI will induct 100 more aircraft in next four years. We have decided not to seek any additional budgetary support except for the turnaround plan approved for the airline earlier. The airline will lease aircraft and has the resources to make the payment that needs to be made for leasing," aviation secretary R N Choubey told TOI.” 

Please mark the words “The government has decided …….. The airline will lease”.

Sad, very sad, that the CEO of the airline makes a case for outright purchase of aircraft and less than 10 days later, the top civil servant in the parent Ministry rules otherwise.  What happened to restoring the Glory of Air-India?  Does any one even understand the meaning of this phrase????????

As I indicated earlier, I was planning to join Kuwait Airways as their Commercial Adviser.  I would be initially based in Kuwait and later in New York.

Comments by some friends made me sit back and think seriously about my decision.  I was leaving a life in my own country where I was quite well known and respected.  It was true that I would be earning a salary much higher than what Air-India paid me, but the comforts, perquisites and life style that I enjoyed were nothing to be sneezed at.

My Air-India salary was insignificant when compared to what the private sector paid.  I was in the grade of an Additional Secretary to the Government of India and my basic pay was Rs. 3,250 per month while that of the M.D. was Rs. 250 higher (Rs. 3,500).  The M.D. was in the grade of a full Secretary to the Government.  You just could not get a higher salary as a Civil servant.

 But, then I had a subsidized fully furnished apartment with air conditioners in each of the three bedrooms, two Company cars with two chauffeurs, a fairly large entertainment budget, cook’s salary and an enviable social life.  The medical facilities that my family and I enjoyed were tremendous.  The fact that AI had not only paid all expenses incurred during my open heart surgery in the USA, but also deputed its Chief Medical Officer to be present during the most critical period was a very important consideration.

Additionally, I had lived my entire working career in a warm “cocoon”, knowing that unless I truly screwed up, I had job security.  Then, there were many intangible perks, eg. a pass to the Governor’s Beach for myself and my family, membership at the Chambers (Taj Hotel’s “in” dining place) etc. etc. We had complimentary tickets to various sporting events, such as Test matches at Wankhede Stadium, Tennis tournaments and Hockey matches between India and Pakistan.  Even the Rendezvous restaurant at the Taj Mahal hotel stocked my personal collection of french wines.

On the other side of the coin, I was venturing into a new world where I knew hardly anyone and that both my wife and children would have to start fending for themselves.  Life in the USA would not be a “picnic”, as they would soon find out.  There would not be a cook, a nanny or a chauffeur.  And, finally, there would be no job security, as the employment with Kuwait Airways could be terminated at short notice.

My wife and I spent many long hours discussing all of the above, but came to the conclusion that the decision was right and had to be taken.  I no longer had any job satisfaction.  I woke up each morning not knowing what shenanigans Mr. Raghu Raj would be up to and what he would ask me to undertake. I could no longer continue working in an environment governed by a corrupt regime in Delhi and a CEO whose only objective was to make money for himself and his benefactors.  I was proud of my record.  I was respected in the travel industry and felt extremely confident that I could hold my own in any new world. 

I would like to reproduce what appeared on the front page of the Bombay edition of the Times of India on August 22, 1980, the day after I submitted my resignation (the Delhi edition carried the same words, but the title read “Air-India’s last professional resigns”:

AI man quits on touchy issue

By K. N. Malik

Mr. INDER SETHI, deputy managing director – commercial, Air-India who had refused to succumb to pressure from politicians and ministry bureaucrats, today resigned from the airline.

Mr. Sethi, who was a senior Air-India official described as the last of the professionals in the airline had opposed the appointment of a group of persons who had a shady past as Air-India’s general sales agents for the USA, Canada, U.K. and Western Germany.

Several members of parliament had criticized pressures mounted on Air-India from political quarters for making these persons general sales agents. Mr. Sethi was able to convince the airline that the appointment of the GSA in the USA would not only create legal problems but would also be a financial liability.

He also refused to change the present GSA arrangement in the U.K. and Canada which had helped the airline withstand fare competition from various airlines.

The politicians and bureaucrats had tried to corner him after criticism in the Lok Sabha that Air-India had favoured the GSA in London and in Bankgok by accepting documents which were available at highly discounted exchange rates.

When asked to explain, Mr. Sethi turned the tables against the Ministry by producing a document which confirmed that the orders for accepting the documents were given by the Minister and conveyed to his department by the Chairman of Air-India.

Mr. Sethi opposed the frequent orders from above for postings and transfers right up to the level of Sales Officers and Traffic Assistants.  He also opposed fleet expansion at a time when traffic trends the world over showed a downward trend.

Mr. Sethi who had 13 years to serve the airline had represented the airline on several international committees.  He was considered one of the most competent hands on fares and international agreements. In his resignation letter submitted to the Chairman this morning, Mr. Sethi said that he had decided to leave the airline for personal reasons.

In early March, the Government had removed the managing director of the airline, Mr. B.S. Das.  A year earlier, Mr. K.G. Appusamy resigned from the managing directorship of the airline.  Another deputy managing director, Mr. Nari Dastur also left the airline.  A vacuum was therefore created at the higher management level of the airline.

My colleagues both in Air-India and in the travel industry gave me many fond farewells and I must confess that I broke down in tears on more than one occasion.

I must mention here the generosity shown by a very good friend and colleague.  We were packing our belongings and had a number of problems living in the same apartment while the packers and movers were at work.  

Azhar Siddiqi, the General Manager of The Oberoi Sheraton, insisted that we move to his hotel and he gave us a two bedroom suite for the last two weeks prior to our move to Kuwait.  All meals were included and even packed lunches for our school going children were provided.

We had to make decisions on what to keep and what to discard.  We ended up shipping 37 pieces of baggage and cartons to the USA to await our arrival (which took place 9 months later) and carrying with us another 37 pieces to Kuwait.  Gulu (SK Gulati, God bless his soul) arranged for a warehouse where the 37 pieces were stored until our arrival.

I must state that Air-India came through magnificently and all items were shipped free of charge.

I left Bombay on October 31, 1980 and Manju and Sarat followed 3 days later along with our cook, who agreed to come with us to Kuwait, but not to the USA.  Our older son, Akhil, stayed on with my brother until he completed his school year - Sarat joined the American School in Kuwait.  Manuel, Air-India’s Airport Manager in Kuwait met me on arrival and escorted me to the Sheraton hotel where I stayed for the first 3 days until Manju arrived and we moved into our seaside apartment that Kuwait Airways provided for us to stay.