India Business
Finance Minister Arun Jaitley (PTI Image)
Finance Minister Arun Jaitley (PTI Image)

Air India Inches Closer To Privatisation As Companies Express Interest

Team Republic |

Finance Minister Arun Jaitley on Wednesday indicated that an expeditious decision would be taken on Air India's disinvestment, with at least two parties having formally expressed interest in buying a stake in the national carrier.

A group of ministers, headed by Jaitley, is working on the modalities of the strategic disinvestment of the debt-laden Air India, which had been making losses for about a decade before posting operating profits on the back of low aviation fuel (ATF) prices over the last few years.

"These decisions are to be taken expeditiously but in their normal course," Jaitley told reporters in response to a query about the Air India stake sale process. The Union Cabinet had in June given in-principle approval for strategic disinvestment of the carrier and its five subsidiaries.

Aviation services provider Bird Group has written to the government expressing interest in acquiring Air India's ground handling subsidiary AIATSL, civil aviation secretary R N Choubey told reporters earlier in the day. "After IndiGo, Bird Group has written a letter with an expression of interest in Air India," he said.

Given that the airline has been a problem child for the government for so long, various proposals, including the Niti Aayog's suggestion for complete privatisation, have been made.

The airline has a debt of more than Rs 52,000 crore and is surviving on a Rs 30,000-crore bailout package extended by the previous UPA government in 2012. Debt aside, however, Air India remains a tantalising prospect for any airline that believes it can turn it around. India's flag carrier is particularly blessed with parking spots at some of the busiest airports in the world. It's land and property holdings may have to be accommodated separately though. 

(With PTI inputs)