Is the argument that"all monopolies were created by the government" true?

December 14, 2025

The meltdown of Indigo Airline which carries around 65% of domestic Indian aviation traffic in December 2025 led to congress leader RaGa say that he is against monopoly. It is good that he realised that because his great grandfather PM Nehru didn’t allow competition and private sector to florish in India. Nehru’s socialist vision was that industries must have huge social responsibility, should not focus on profits as profit is adirty word and industry should be under government control. Thus large number of private enterprises were nationalised like PSU banks, Air India, HAL, GRSE etc. This list is large and these PSU were managed by IAS officers who have little knowledge of business and only follows dictat of politicians.

Biju Patnaik was an ace pilot who gave his services during 1948 Indo-Pak war in Kashmir. When the capital Srinagr was about to fall, Indian government took the decision to airlift Indian Army to fight Pakistan backed gurellas. Biju Patnaik flew Dakota jet to ferry Indian Army soldiers and land them safely in Srinagar. Biju Patnaik also undertook a daredevil rescue operation of Indonesian top leadership and brought them to New Delhi when their lives were danger under the colonial Dutch rule. For this, he was given highest civilain award by the Indonesian government.

Biju Patnaik had a fleet of planes under ‘Kalinga Airlines’ and this airline was merged with government owned Indian Airlines. Similarly, Tata owned Air India was nationalised in 1953.

Biju Patnaik’s (left) Kalinga Airlines was merged into PSU Indian Airlines which was a domestic airline monopoly

JRD Tata’s Air India was nationalised which was India’s international airline monopoly

Only after the liberlisation policy of 1991, private airlines were allowed in India from 1994. In 1994, the government approved eight new airlines - Jet Airways, Damania Airways, East West Airways, Sahara Airlines, ModiLuft Airlines, and NEPC Airlines.

Air India was still in profit for many years after natiolalisation as JRD Tata was its chairman. Slowly politicians started misusing the airline. By the time PV Narasimha Rao left the PM office, Air India had already gone into a huge loss of Rs 30 thousand crores. Multiple efforts to revive it failed as losses kept mounting.