The government on October 8 announced that the Tata Group won the bid to purchase national carrier Air India, the airline founded by JRD Tata in 1932. Like any other Bollywood movie’s climax, Ratan Tata tweeted on the occasion of Air India’s ghar waapasi. He wrote, “Welcome back, Air India”.
For the unversed, JRD Tata and Ratan Tata belong to different branches of the Tata family. But they shared a close relationship, with Rata Tata describing JRD as “a father and brother to me”.
Life came a full circle for Air India and Tata Group, as Tatas having being found the airline in 1932, losing it to nationalisation in 1953, and emerging the winning bidder for India’s flagship air carrier in 2021.
In an interview, JRD had described how Nehru and Mrs. Gandhi “developed their polite ways” of telling him to “shut up”. JRD said Nehru knew that he disagreed with all economic policies and even foreign policies of his government and was never able to discuss economic matters with him.
Back then, the government had paid Rs 2.8 crore to Tata Group and took over a 100 per cent stake in the venture.
JRD Tata founded Tata Aviation Service in 1932 with an investment of Rs 2 lakh and piloted the first flight of Air India, then called Tata Air Mail. It was a cargo flight. It soon became a profit-making venture.
After World War II ended and Tata got back control of the aircraft, JRD Tata renamed the airlines as Air India in 1946 and went public as a joint-stock company.
Despite the nationalization of Air India, JRD Tata remained the national carrier’s chairman for over 25 years. He was removed from the position in 1978.
Presently, the winning bid brings to the Tatas, a 100 per cent stake in Air India and its low-cost arm, Air India Express as well as a 50 per cent stake in ground-handling company Air India SATS Airport Services Private Limited (AISATS).
As far as the debt of the airline is concerned, Air India has a total debt of Rs 61,562 crore. Tata takes over Rs 15,300 crore of the debt. The rest would be transferred to a special purpose vehicle (SPV).