Second attempt to privatise Air India to commence soon
October 9, 2019: The government of India will soon invite bids for the privatisation of national carrier Air India and sell off 100 percent of its stake by issuing an Expression of Interest (EoI) by the first week of November, according to reports.
October 9, 2019: The government of India will soon invite bids for the privatisation of national carrier Air India and sell off 100 percent of its stake by issuing an Expression of Interest (EoI) by the first week of November, according to reports. This is the second attempt by the national carrier, following a failed one in March 2018.
Government officials are also planning to meet the potential buyers before the issuing of EoI as the first attempt to divest the airline in March 2018 failed as the government wanted to keep 24 percent of its stake which didn’t attract a single bidder.
The loss-making Air India now has a net debt of Rs74,000 crore and is surviving on a Rs30,000 crore government bail-out and the special purpose vehicle (SPV) Air India Assets Holding Ltd (AIAHL) which took over Rs29,464 crore of the debt.
The privatisation of the airline with 12 percent domestic market share is crucial for the government of India to meet its disinvestment target of Rs1.05 trillion by the end of this financial year. The ministerial panel for the disinvestment of Air India is headed by home minister Amit Shah and includes finance minister Nirmala Sitaraman, aviation minister Hardeep Singh Puri and railway minister Piyush Goyal. The panel met on September 2019 and is expected to meet again soon to give the clearance.
The airline’s board meeting is scheduled for next week to approve the accounts of 2018-19.