- Government plans to complete the disinvestment process by Diwali
- The airline reported a loss of Rs 7600 crore in the financial year ended in March 2019
The Department of Investment and Public Asset Management (DIPAM) has directed Air India to freeze all promotions and appointments in the wake of its proposed privatization. DIPAM has also ordered that the airline can only start a new flight service unless it comes under a dire emergency.
“The direction came almost a week back. It says that due to impending privatization, no major initiatives have to be taken up. There will be a freeze on appointments and promotions,” an official source told IANS.
The Government is starting the disinvestment process of the airline soon. For the disinvestment process, the airline’s books of accounts have been closed until July 15, 2019.
The initiative to sell Air India to a private player has been going on for a long time. The Government, during its last term, tried to find a bidder. In its second term, Government has reconstituted the group of ministers to decide the course of action. Amit Shah heads the new group of ministers. The group is expected to meet next week to take some crucial decisions related to privatization. The Government is looking forward to completing the sale of Air India’s stake in 5-6 months.
“We will try to finish it off by Diwali, if not before,” Department of Investment and Public Asset Management (DIPAM) Secretary Atanu Chakraborty said on July 7 to NDTV.
Air India has a debt of Rs 58,000 crore. The airline reported a loss of Rs 7600 crore in the financial year ended in March 2019.
According to Civil Aviation Minister Hardeep Singh Puri, Government is not equipped to run Air India by its own. “Left to myself, I would all be interested entirely in supporting the public sector. But, the question arises: is the Government equipped to run an entity, like Air India, where operational decisions on a day to day basis have to be taken on the spot?,” Puri said in the Rajya Sabha.
Air India has around 10,000 permanent employees, and there are no official comments about Air India about the new announcement.
Ria is a lead news writer at Aviation Scoop. She writes from dawn to dusk, reads in the evenings, and draws at some ungodly hours. She loathes human interaction, and finds solace in the sweet, musky smell of old books, and rain. Find her on Twitter here - @rialakshman.