Wednesday, December 05, 2018

How the government took Air India from JRD Tata, asked him to run it, and then took it away again

Nationalisation was hotly debated since Independence. JRD [Tata] opposed it on several platforms but wasn’t invited by the government to present his views. The decision was a fait accompli. Communications Minister Jagjivan Ram, who supervised modalities of nationalisation, did consult JRD, but that was about compensation to be given to companies getting nationalised. JRD was disheartened.

At a luncheon meeting with Prime Minister Nehru in November 1952, he expressed his anguish that the government had intentionally treated the Tatas shabbily, and that it was a planned conspiracy to suppress private civil aviation, particularly the Tatas’ air services. Nehru reassured him of no such intentions. In fact, in a personal letter to JRD, he placed on record the high appreciation he had for the Tatas, who had pioneered several projects, and the excellent services rendered by Air India International.
In his reply, JRD expressed his disappointment at the government’s decision to proceed with such a major step without any consultations with the Tatas, who were pioneers in Indian civil aviation.
He emphasised his conviction that nationalisation would not result in an efficient and self-supporting air transport system. All along, JRD’s contention was that the new government of India had no experience in running an airline company, and nationalisation would mean bureaucracy and lethargy, decline in employee morale and fall in passenger services.

The government maintained that nationalisation would bring order to the industry, and that the Congress Party had a policy to nationalise all modes of transport since two decades. In hindsight, the communication between the two stalwarts of Indian polity and Indian business represents perspectives belonging to two ends of the spectrum. It would take six decades to reveal whose viewpoint stood the test of time. For the time being, the discord seriously impacted the warm relationship between India’s first prime minister and the leader of India’s largest business house.
05/12/18 Shashank Shah/
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