India’s transportation giants: Lost In transit

India’s transportation giants: Lost In transit

In the early days after India’s Independence, a middle-aged Indian man was flying on an Air India flight. When his meal was served, the man realized that the lights above his head were too dim for him to see the food properly. After fiddling with the lights above his head for some time, the man gave up, took out a small notebook and scribbled down some notes. The next day, at Bombay House, the man, JRD Tata convened a meeting of Air India officials and asked them to improve the lighting above the passengers in their aircraft. The executives were a bit surprised by this odd suggestion, to which he said, “We serve such great food, shouldn’t our passengers be able to see it? All the aspects of our airline are critical. We are not merely a transport service; we are perfecting the art of passenger service in the airline industry.”

This anecdote might hardly seem to be a story from Air India, considering the intractable mess it is now in. From being the pride of Indian skies, to being an airline so maligned by passengers, policy-makers and politicians alike that it is finally likely to meet its fate of being broken into parts and divested or sold to a single entity; the painting of the Maharaja finally giving way to the emblem of some other airline.

Similar ailments

Similar is the plight of the Indian Railways; an institution that has enjoyed a reverential, nostalgic monopoly over India. Many people still rightly respect the relative efficiency of the railways, despite its severely insufficient manpower, infrastructure and the resultant rise in accidents. Until now, due to its indispensability and history of goodwill, the IR was not deeply worried of its profitability or relevance. To make matters worse, the cavalier attitude of most governments led to them using the railways as a portfolio to pad their voting constituencies with new and often unsustainable train routes, often without consideration of infrastructure available on those routes. However, in the last decade, ground realities have shifted, and liberalization seems to have finally caught up with both these transportation giants. Both are now struggling to devise ways to remain relevant in the new age of sleek, speedy and no-nonsense transport.

India’s leap to flight

Until recently, as late as a decade ago, the Indian Railways did not face any challenge as a transporter on long or medium distance routes, or for that matter, even on many short distance routes. Air travel was beyond the economic means of most Indians and buying tickets was a tedious process. Hence for most travel, Indians relied on the railways or for shorter routes, buses and cars. The beginning of commercial air services changed all that. Jet Airways bought in a semblance of class and professionalism to air travel, while the recent entrants Indigo, Spicejet, GoAir and the recent launch of Vistara revolutionized air travel in India. By now, the internet has eased rail and air bookings and killed the business of many smaller agents, although of course, a vast swathe of India still lacks the connectivity or knowhow to book tickets online. The largest burden of this change has been borne by the railways and Air India. A slightly pricier air ticket is preferred to the rickety ride in the railways and its frequent delays on most of its routes.

What the railways still has an unparalleled reach across India, albeit its speed remains a problem. Air India does not even have that as an international carrier. Airlines such as Turkish Airlines fly to 227 international destinations compared to the 89 covered by Air India, while domestically, commercial airlines have matched AI’s reach to under-served destinations. AI suffered irreparably due to the misguided nationalisation and the subsequent decades of mismanagement by government officials clearly unqualified to manage it. Immense losses in the past decade have now reduced this airline to an object of near ridicule.

The problems for both of these carriers are not simply their finances, but a lack of vision that failed to plan for the airline revolution and the change in consumers’ tastes. Rail travel is no longer a major mode of transport on the ‘rich’ routes in India, where the Railways’ own report suggests that air travel will supplant it as the most popular mode of transport in only three years. Here, the alarming fact is not only the supplanting of the railways by airlines, but the fact that the railways waited until 2016 to study the problem.

Reforms in the railways have been slow, although they seem to have gained some thoughtfulness in the tenure of Suresh Prabhu. While the bullet train idea is an ambitious and possibly a foolhardy one, Prabhu’s focus otherwise is of speeded up incremental change. Some of his steps, however, have been counter-intuitive. Surge pricing in premium trains was one such idea. It is simply inexplicable why the railways chose to increase its costs under the guise of increasing revenue, while airlines were cutting their prices in glee to welcome it. While the railways cite rising revenue to justify it, will it remain so, in the face of lowering flying costs and the increasing efficiency and frequency of air travel?

The passenger mindset has undergone a quantum shift, and the number of such passengers is steadily rising. Most travelers are often looking for an efficient and speedy experience, which both the IR and AI are scarcely equipped to provide. This is seen especially while competing with airlines such as Indigo. Offering no over-the-top services, Indigo flies to a large network of destinations while maintaining punctual flight timings, generally clean and comely flight cabins and an efficient staff, coupled with reasonably priced decent quality food. Paying extra for these conveniences is not a worry for most middle-class passengers, who would rather save time than pinch on money and have a bad travel experience. To compound problems, Prabhu’s own government seems to be working to intensify the railway’s woes in a way by introducing the UDAN scheme. If the economics of UDAN works for commercial airlines, it will manage to push the railways into even more irrelevance on routes which are still profitable.

For Air India, the government rightly seems to have given up. Jaitley and Modi both believe that the government need not involve itself in running an airline, a point which is not entirely off the mark given India’s soaring passenger numbers. In fact, the onus is now on the government, which is lacking in upgrading air travel facilities. Most major Indian airports are bursting at their seams, direly in need of larger terminals and more runways to accommodate the sharp rise in flight demands. On other fronts, in cities such as Bengaluru and even Mumbai, seamless public transport to and from the airports is direly lacking.

The path for AI now seems inevitable. If some portion of it goes to the Tata Group, Ratan Tata will probably be tickled by the irony of getting back the airline Nehru effectively stole from his uncle. It will probably be more fitting to restore AI’s private ownership and utilise its vast, enviable but grossly mismanaged infrastructure and prime landing spots to turn it into a top notch airline such as Emirates, Etihad or Singapore Airlines.

For the railways, however, the choice of fight or ‘flight’ does not exist. Prabhu and his successors have the task of reinventing one of India’s most complex yet vital lifelines. Prabhu, in dealing with the multiple layers of the problem, has focused on the speed and safety of trains, and the quality of food and linen. However, he is repeatedly coming up with options where people can opt out of these services. According to recent reports, one in five people are opting out of food on the Tejas Express, but that is not a good sign. It is yet another manifestation of the fact that the railways is failing to provide a basic facility on a premium train in India. Prabhu’s new opt-out offerings are unlikely to make passengers happy. On a long train journey, it is silly to expect that passengers will be happy with the option of giving up linen, or of not having the option to buy food on the train, especially when the questionable quality of outside food vendors has led to the railways disallowing them from vending their products in air-conditioned coaches. Prabhu is trying various alternatives, but struggling to maintain a balancing act of not raising costs of rail travel for the hundreds of millions still not part of the airline crowd. This inevitably means raising premium train fares which are profitable. The railways are caught between tricky alternatives.

However, professionalizing the railway employees seems to be a tough ask, and the minister cannot hope to solve this one tweet complaint at a time. Food and linen services are probably best outsourced to reputable vendors, with a quality check mechanism built to monitor it. Prabhu also seems bent on gaining more advertising and commercial revenue through railway real estate, which can offset some losses, but only partially. However, considering the alarming regularity of accidents, the latest of the Utkal express, it will be better if Prabhu takes some things such as catering and linen off his plate and prioritizes safety, speed and infrastructural overhauls, all of which will need prolonged, determined and hard effort.

The Indian people do see the large and complicated nature of the railways and will understand that changes take time, so most will not judge Prabhu too harshly if his remedies don’t show dramatic results in the short term. In fact, even smaller improvements such as food quality, linen and coach facilities can bring back some passengers who will still like to switch to the railways for some journeys, while Prabhu will have more time to speed up infrastructure and safety parameters. No one expects a bullet train experience, and incremental improvements will most likely be welcomed by passengers. However, Prabhu cannot afford these fundamental improvements in speed and safety be derailed by bad quality food and linen.

Picture credit: Wikimedia Commons

For both these companies, it is surprising that the government never acknowledged the expertise of people such as Tim Clark, the President of Emirates. Clark is nearly single-handedly responsible for Emirates’ success, along with the deep pockets and foresight of Dubai to reduce its reliance on oil. Nehru’s haphazard nationalization and the nearly constant neglect of AI led to a colossal waste of public money, and rampant mismanagement of a company which most of the Indian political class wanted to run only as a fiefdom of their own. With some thoughtful groundwork, route planning and professionalism, AI could have catapulted itself into a major international carrier, utilizing on India’s geographical location, its unique capabilities of multiple large airports which it could have used as hubs, and by heeding the rising prominence of air travel across the world. In fact, Emirates is an extremely late entrant in the race, commencing operations only in 1985 but now being a ‘super connector’, since Tim Clark realized that a lot of the world’s airports could be served by Emirates while having a single hub, Dubai.

Picture credits: Wikimedia Commons

For the railways, it remains to be seen whether it can sustain the onslaught of its new competition. After two recent accidents, Suresh Prabhu offered to quit, and might be allowed to go considering it is politically expeditious. But that is not how things can work. Resigning ministers are not the solution, unless of course, they indulge in misconduct. What the railways needs is its people to work with breakneck speed to reinvent itself and their services. Before seeking magic ‘bullet’ remedies to its problems, India’s most celebrated form of transport should work on its fundamentals to gain back the passengers who loved it in the past, or risk losing them to a more efficient mode of transport. Losing Air India to privatization will probably not be sad for most Indians, but seeing the railways decline into a state of disrepair, disrepute and eventual irrelevance will be a painful sight for the Indian people, myself included. For India's people as well as its government, the decline of the railways will be a monumental failure..