While I think a potential merger between Air India and Indian Airlines makes perfect sense and is in fact long overdue, I have a few concerns about how the integration would take place.
Firstly, while having a domestic feeder network has always been a need of Air India, the setup for the airports in India isn’t conducive to promoting connections from domestic flights to Int’l flights. Unlike most airport in the west, you have jump through hoops in many cases to switch from the domestic terminal to the Int’l terminal (for example at Mumbai). I have several relatives who will no longer connect in Mumbai or Delhi to points within South India for this reason. Secondly, over the past five years Air India has switched most of its operations to Europe and North America to Mumbai (previously most flights were routed BOM-DEL-Europe) without a stop in Delhi. Indian Airlines domestic network is much stronger in Delhi than it is at Mumbai where Jet Airways has much stronger connection possibilities these days. Also, I think Indian Airlines has become a “brand name” of some sort in destinations such as Sharjah while Air India is a brand name in the west. Which name will be used for a merged airline? Lastly, and most obvious is the mixed fleet types with IC rapidly moving towards an all Airbus fleet and Air India doing opposite with recent purchases of 737-800s (for AI Express), 777 and 787s.
What does everyone think about the issue of compatibility and how will the integrated airline look?