Question

Why does air conduct electricity while lightning even if it is a very bad conductor of electricity ?

Answer 1

This is due to the principle of dielectric breakdown. During thunderstorms, the air between the cloud and the ground acts like a capacitor. When the electric field is high enough, the air partially ionizes, at which point there are free electrons to carry current and the air becomes, essentially, conductive.

When the potential difference (or voltage) between 2 points are very high, the insulator in between has very high stress. For air, it gets starts ionizing.

When the voltage(developed in the cloud) exceeds the threshold level which air can withstand(with respect to ground level), the charge is discharged suddenly to the ground, breaking the insulation property of air, that we see as lightning.