Published 16:18 IST, August 29th 2019
Air India to undergo total privatisation: Civil Aviation minister Puri
In a major development for India's national carrier, the aviation minister Hardeep Singh Puri said that total privatisation will happen for Air India.
In a major development for India's national carrier, the aviation minister Hardeep Singh Puri said that total privatisation will happen for Air India. Speaking at an event, he said that he cannot disclose the route taken by the government from that platform but he is sure of the decision. "I am very clear as to what we are looking for. It is very clear that there should be total privatization and it has to be done in shortest possible time. We will not do any waiver in the time limit," he said. "The government’s determination to privatise Air India is a given, it’s undiluted. It should be a total privatisation. We have to get the best possible deal in the shortest time possible,” he added.
Air India: Developments so far
The Centre, on June 27, had decided to go ahead with the disinvestment of the National carrier Air India, as announced by Union Minister for Civil Aviation (Independent charge) Hardeep Singh Puri saying that this decision was recommended by the government-appointed Air India Specific Alternative Mechanism (AISAM). Following the appointment of AISAM, Puri shared that volatile crude oil prices & adverse fluctuations in exchange rates in March 2018, made it an inconducive atmosphere to proceed with disinvestment.
In an AISAM Meeting held in March 2018, which is last year, it was decided that due to issues like volatile crude oil prices & adverse fluctuations in exchange rates, the atmosphere was not conducive for the disinvestment.
— Hardeep Singh Puri (@HardeepSPuri) June 27, 2019
But this was last year.
Puri added that while continued support from the Centre had resulted in improvement of financial and operational performance of Air India, the government had decided to go ahead with disinvestment.In complete contrast, earlier in the day, the minister had said in the parliament that the present economic environment is not conducive for the sale of state-run carrier Air India in the immediate near future, citing the same reasons of oil prices that he claimed hindered Air India's disinvestment in 2018. He had added that the government will revisit the sale once global economic indicators including oil prices and foreign exchange conditions stabilize.
Earlier on Wednesday, Puri had shared in the Rajya Sabha that the grounded airline had a total debt of Rs 58,351 crore as on March 31 this year. Previously in 2018, AISAM had earlier decided to sell 76 per cent in Air India and the buyer was required to take over Rs 24,000 crore debt of the carrier along with over Rs 8,000 crore of liabilities. However, the stake sale failed to attract any bidder when the auction process completed on May 31, 2018. At that time, Air India's total debt burden stood at Rs 55,000 crore. As a precursor to the strategic disinvestment of Air India, the Cabinet in February approved setting up of a special purpose vehicle (SPV) - Air India Assets Holding Company - to transfer Rs 29,464 crore worth loans of the national carrier and its four subsidiaries.
Updated 17:19 IST, August 29th 2019