CIVIL AVIATION ‘We are against FDI in airlines' RAVI SHARMA Interview with Prakash Karat, CPI(M) general secretary.

CIVIL AVIATION

'We are against FDI in airlines'

RAVI SHARMA

Interview with Prakash Karat, CPI(M) general secretary. http://www.frontlineonnet.com/stories/20111216282503400.htm Volume 28 - Issue 25 :: Dec. 03-16, 2011 INDIA'S NATIONAL MAGAZINE from the publishers of THE HINDU Interview with Prakash Karat, CPI(M) general secretary. V. SUDHERSHAN    Prakash Karat: " Private players should find ways to get out of the jam they have got into." IN a telephone interview to Frontline, Communist Party of India (Marxist) general secretary Prakash Karat spoke about foreign direct investment (FDI) in the domestic airlines sector. Excerpts: In the wake of the financial crisis affecting Kingfisher Airlines, many players in the domestic airline sector, including Vijay Mallya, chairman of Kingfisher Airlines, are demanding FDI in the domestic airline sector. The CPI(M) is totally against FDI from foreign airlines in our domestic airline companies. Even earlier [in 2009], when the proposal came up, we had said that there was no necessity to open up [airlines to] FDI. Kingfisher Airlines urgently needs capital if it is to survive? If there are genuine problems in the aviation sector let the government address these issues. But why FDI? These advocates of FDI will first ask for 24 per cent, then 49 per cent, then 74 per cent…. The pattern is eventually for those foreign airlines taking over the Indian airline. Advocates of FDI say that Indian private airlines would be forced to shut down if they are not able to raise capital and that FDI seems the only option at the moment. If the logic behind opening up, liberalising, the aviation sector was to allow competition, then private players should find ways to get out of the jam they have got themselves into. If they are not able to survive the competition, why should the government step in? Mallya has stated that he is not seeking a bailout using taxpayers' money, but many in the government have suggested a bailout by the banks to whom Kingfisher owes money. Our view is that the banks should take a decision on their exposure to Kingfisher Airlines not on any political directions but solely on banking norms and standards. The banks should judge for themselves whether Kingfisher Airlines is creditworthy and lending to it is a good commercial business proposition. The banks, which are after all public sector organisations, cannot take risks on the basis of governmental directions. It is not for the Government of India to order them to bail out anybody. On Air India… There are already two Parliamentary Standing Committee reports on Air India. The Government of India should seriously consider implementing these. Air India should be allowed to work without undue interference. The management should be given the autonomy to function.