1953: Air India nationalised

The setting up of India’s first private commercial airline in 1932 was viewed with wonder.

October 15, 1962: JRD Tata stands near the Leopard Moth in which he made his 30th anniversary commemorative Karachi-Bombay flight. | Photo Credit: PTI

The story of Air India is about how a Tata founded an airline, only to have the government take it over, and how another government returned it to the Tatas after struggling to run it for nearly 70 years.

The Indian government nationalised the private airline in 1953, ran it with taxpayer money, repeatedly underwrote losses after 2007, put it up for sale, and finally handed it to one of the bidders, the Tata group.

When Jehangir Ratanji Dadabhoy (JRD) Tata set up India’s first private commercial airline in 1932, it was viewed with wonder. On October 15 that year, he piloted Tata Air Services’ first flight, from Karachi to Mumbai, and thus began the story of commercial aviation 15 years before Independence.

In 1938, JRD Tata named the company Tata Airlines, and later Air India. In June 1948, it started a service to London. Four years later, the Planning Commission recommended to the government that the airlines be nationalised.

In 1953, Parliament passed the Air Corporations Act, enabling the merger of all airlines into two corporations owned and operated by the government. Nine airlines operated in India then: Air India, Air Services of India, Airways (India), Bharat Airways, Deccan Airways, Himalayan Aviation, Indian National Airways, Kalinga Airlines and Air India International. The result was a monopoly for Indian Airlines and Air India. JRD Tata was chairman of the government venture. He held the post for over two decades, despite a few unpleasant incidents with politicians.

When the airline was finally picked up again by the Tata group last year, it marked the biggest disinvestment of a government-owned asset.