The national air carrier, Air India, has been operating under a loss for years now and has a mountain of debt on its shoulders. Thus the government had earlier decided to sell a 76% majority stake of the airline to interested buyers. However, there were no takers for the airline at that point in time. In the second round of attempt, the Modi government might actually sell the airline to a private entity.
Speaking to CNBC TV18, Hardeep Singh Puri, Union Civil Aviation Minister, said the disinvestment plan of Air India is on track and it will complete within the year.
Bidders Are Looking at the Books of Air India
Puri told the publication that interested buyers or bidders are currently looking at the financial books of Air India. He further said that the complete process is being carried out under the purview of the Finance Ministry through the Department of Investment and Public Asset Management.
Puri explained the reason behind the delay in the disinvestment process. The Union Civil Aviation Minister said that because of COVID-19 and restrictions on flying, private entities are finding it hard to bring their experts to India. This is why the government has decided to give the interested bidders an additional time of 3 months.
One of the major things that Puri said was that the disinvestment process would complete by the year-end. He wasn’t even talking about the end of the financial year. Puri stressed that the process would complete before this calendar year ends on December 31, 2021.
Air India’s disinvestment process has moved to the second stage. This is the stage where the government will receive the final bids for the airline. All the interested buyers will make their bids, and then looking at the most favourable bid; the government will select a winner.
Nirmala Sitharaman, Finance Minister of India, had also said during the recent Union Budget that the disinvestment process of Air India and Pawan Hans would be completed before the end of the financial year.
Air India needs to be privatised in order to compete with other airlines such as IndiGo and SpiceJet, which hold a majority of the market share.