AI sale: NITI Aayog gives SpiceJet's suggestions to Aviation Ministry

As the government of India is working out the modalities of Air India’s sale, they are considering the key suggestions shared by SpiceJet to transform India into a global aviation hub. The think tank of the government, NITI Aayog has forwarded these five suggestions shared by SpiceJet to the Civil Aviation Ministry. Also, NITI Aayog, while forwarding these suggestions to the Ministry, has termed them as ‘recommendations’ for Indian carriers. These recommendations are called, "industry-wide concerns and recommendation of Indian carriers for urgent intervention." 

SpiceJet’s key suggestions to make India an aviation hub 

The key suggestions submitted by SpiceJet and forwarded to the Aviation Ministry by NITI Aayog suggest proposals that include, bringing jet fuel under GST, making India a global aviation hub and developing commercially viable alternate fuel supply. As India lacks the wide-body aircraft, suggestions also point out that the foreign airlines in the country take up to 60% of India’s international space. NITI Aayog has also asked the Ministry to consider the matter on an urgent basis. After Jet Airways, Air India is the only airline with wide-body aircraft and international routes.  

Read: GoM headed by Home Minister Amit Shah discusses Air India sale

Government to fast-track the disinvestment 

With the debt burden of Rs. 58,000 crores, the Modi government in 2018-19 had invited bids from investors to buy out 76% stake and management control in Air India. This process initiated by the government failed last year as no company was interested in investing. Following that, this year, a group of ministers or GoM headed by Home Minister Amit Shah has re-started the disinvestment process. The government, as per sources, can plan on selling the entire stake this time. This is because the government is planning to conclude the process by December, 2019.   

Read: Air India explores plans of debt financing through subsidiaries

The reduction in corporate tax is also likely to attract the investors this time. Experts are considering SpiceJet as a strong contender to bid during the sale as no other airlines have shown interest in this matter. The perks of acquiring Air India will include the possession of best flying slots and flying rights. The acquirer of Air India would also dominate the international operations because of its sizeable fleet. Some sources have also claimed that the government has done the groundwork and maybe in talks with potential buyers.  

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