Air India has taken baby steps towards a turnaround. For the first time in a decade, the airline has posted operational profits though it is still in the red at the net level. Piloting the turnaround is its CMD, Ashwani Lohani, a career civil servant who built his reputation by rejuvenating the Madhya Pradesh State Tourism Development Corporation when it was floundering and most of its assets were about to be put up for sale.

Admittedly, Air India is still a work in progress. The take-off will not be complete until it manages to post a net profit. And the stumbling block is huge interest costs. The flag-carrier is burdened with a massive ₹50,000 crore debt thanks to the merger with Indian Airlines. The interest charge on this loan adds up to ₹4,000 crore every year.

The airline is attempting to get its act together at the operational level and Lohani is hands-on at the controls. But the key to success though will be getting the pilots on his side. For long, Air India’s pilots have held the airline to ransom crippling its operations time and again and nullifying whatever gains it made. He started off well: the first meeting with the Indian Commercial Pilots Association was good but the road ahead will be tough and treacherous. That there are not enough jobs going for pilots right now should work to Air India’s advantage.

Lohani’s strategy appears to be to expand operations by increasing fleet size, driving revenues and hoping that a good part of that will go to the bottomline. But the headwinds are strong. Competition from lowcost carriers cannot be underestimated and there is the rebound in oil prices. The last thing the airline will want is a rise in fuel costs that may abort a take-off. Yet again.

Senior Deputy Editor

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