New Delhi: The government has announced its intent to disinvest Air India and it is well known that Ashwani Lohani, the chairman and managing director of the ailing national carrier, has never been a votary of privatisation. In fact, quite the contrary, since he likes to be referred to as the quintessential “turnaround” man. No wonder then that as the talk of Air India privatisation was gathering steam, Lohani began eyeing the post of the Railway Board chairman – he was a former railway employee.
In fact, when present Railway Board incumbent AK Mittal was set to retire last year, fervent rumours about Lohani succeeding Mittal did the rounds for days until the government decided to give Mittal an extension. Now that Mittal has resigned, allegedly taking responsibility for two major train accidents in a matter of days, Lohani is set to finally take over as the Railway Board Chairman. In a sense, it is déjà vu.
But all the twists and turns in Lohani’s arrival at Rail Bhawan do not take away from the seriousness of this appointment, nor from its myriad difficulties. The Railway Board is already in a churn with one senior member asked to go on leave and four other employees suspended after the Utkal Express tragedy; Railways Minister Suresh Prabhu is widely expected to be divested of his portfolio in the impending Cabinet reshuffle. The circumstances under which Lohani will take charge as the chairman of the board – he supersedes some other claimants for the job and this may cause heartburn – can only be described as dire.
Lohani’s tenure at Air India has been a mixed bag at best. On the operational front, he has earned few laurels though financially, the airline is in a better shape than when he came in. Lohani will be remembered for steering Air India to profits at the operational level in FY16 and FY17, the first two consecutive such years since the erstwhile twin airlines (Air India and Indian Airlines) merged to form the present entity a decade back.
MoS Civil Aviation Jayant Sinha had said in Parliament last month that Air India posted a provisional operating profit of Rs 300 crore in FY17, three times the number it claimed in the previous fiscal, as revenue increased to Rs 22,146 crore versus Rs 20,525 crore in FY16. Net loss was the lowest in four years at Rs 3,643 crore, 42 percent down from the figure in 2013-14 at Rs 6,280 crore. The total accumulated losses of Air India as per the audited accounts on 31st March 2016 were Rs 41,380 crore. So the airline’s math was far better under Lohani than his predecessors.
But here’s the catch. Finances improved, operational metrics did not. As per data released by safety regulator DGCA, Air India topped the list of passenger complaints, had the worst on-time performance at top four airports and reported the lowest load factor (percentage of occupied seats) in June this year among all national airlines.
Air India did not get 3 in 10 flights on time at these four airports with an OTP of 69.9 percent in June while market leader IndiGo got over 86 percent of its flights on time despite niggling engine issues grounding some of its fleet. Not just June, Air India’s performance has been far from perfect for the entire first half of this calendar year. In each of the months between January and June on 2017, Air India saw the lowest load factor among all national carriers – January at 81.4 percent, February 79.8 percent, March 74.6 percent, April 78.7 percent and May 80.1 percent. It had the highest number of passenger complaints among all airlines between January and June and worst on-time performance at four of India’s busiest airports in four out of these six months.
And this piece in Economic Times says Air India recorded the maximum safety violations in the last three years. Then, in 2014-15, Air India controlled 17.9 perecnt of the domestic market, which fell to 15.9 percent in 2015-16 and to 14.2 percent in 2016-17.
So though Lohani gets some of the credit for improving the Maharaja’s financial performance (much of it was due to benign oil prices), he must also shoulder the blame for continued poor operational metrics of the airline. Will he be able to bring about operational efficiencies in a mammoth organisation called the Indian Railways? An ex-Railways official says like his predecessor Mittal, Lohani is also not an “operations” man. A charge that minister Prabhu has also faced several times during his tenure.
This piece in Firstpost quotes a senior railway official as saying that though Prabhu was an honest and sincere minister, he was in no way a hands-on person. He was averse to travelling by train to conduct inspections, while also lacking an eye for detail. “How could the ministry deliver the prime minister's expectations, if the two persons at the top, the minister and the Railway Board chairman, were both lacking this attitude”.
Lohani will have a lot to do, to not just instill confidence in his Railway Board colleagues but also to assure the public that the Railways will henceforth be taking safety a bit more seriously. Numbers tell a rather depressing story as far as train accidents go and since Lohani is being brought in to improve the Railway’s safety record more than anything else, he’d better have a detailed plan up his sleeve. Here are some stats:
In each of the last two fiscal years, there has been a train accident every three days on an average. Last fiscal, the number of people who lost their lives in train accidents almost doubled over 2015-16, to 238. Accidents happen primarily because either there is a lack of standard operating procedure, there is an element of human failure or equipment failure. But there is no gainsaying that travel by rail across India is fraught with risk of loss of life and property.
This piece in IndiaSpend quotes from replies given in the Upper House to say that death toll from train derailments in 2016-17 is now the highest it has been in a decade at 193 people. The toll of 193 dead comes during a year that reported the fewest train accidents over 10 years (104) ending March 2017.
A Parliamentary Standing Committee on Railways has noted in its report last December that more than half of all train accidents happen due to lapses of railway staff. Out of 69, 71, 85 and 78 rail accidents during 2012-13, 2013-14, 2014-15 and 2015-16 respectively, 46, 51, 60 and 54 accidents were respectively on account of the failure on the part of the railway staff. The faults of railway staff in such cases include carelessness working, poor maintenance cases, adoption of short-cuts, non-observance of laid down safety rules and procedures.
As on April one last year, there was a shortage of more than 16 percent in the safety staff strength sanctioned by the Railways at various levels. This translates to a shortage of a 1.22 lakh personnel across various safety functions!
Lohani will have all this to look after and possibly amend.
Published Date: Aug 24, 2017 15:21 PM | Updated Date: Aug 24, 2017 15:21 PM