The Narendra Modi-led government’s second attempt to
privatise Air India will soon see the light of the day as the panel formed on the divestment of the national carrier will hold a meeting “in the next few days” to consider and approve the proposal.
The panel called
Air India Specific Alternative Mechanism (AISAM) has been reconstituted recently under the second term of the Modi government and is being led by union home minister Amit Shah. The government is looking at total privatisation or divesting up to 100 percent stake in the airline, senior government officials said.
"Government’s determination to privatise Air India is a given. It is undiluted. The procedure involves the formation of an alternative mechanism which is a group of ministers. My submission to you is that it has been formed, it is headed by our home minister
Amit Shah ji…the meeting will happen in the next few days," union aviation minister Hardeep Singh Puri said at a press conference today.
While meeting on the matter of disinvestment has already taken place at the level of cabinet secretary, the recommendation to privatize Air India will be put forward before the AISAM now, Puri added.
“It should be total privatisation, we have to get the best possible deal and we have to get it in the shortest time available. We will not do any wavering of the kind that we witnessed earlier when we found a situation when we hold back 26 percent. We will have the agenda in the first meeting and then it will be a quick affair,” Puri said, adding that the government is confident that there will be interest in buying Air India.
Referring to the fragile finances of the airline, the government think-tank NITI Aayog had suggested divestment of Air India as part of its recommendations on Strategic Disinvestment of the Central Public Sector Enterprises in May 2017.
"Further financial support in a mature and competitive aviation market would not be the best use of scarce financial resources of the government," NITI Aayog had said in its report.
Soon after, the Cabinet Committee on Economic Affairs in its meeting held on June 2017 had given in-principle approval for considering strategic disinvestment of Air India and its five subsidiaries.
The Cabinet had also constituted an Air India Specific Alternative Mechanism (AISAM) to guide the process on strategic disinvestment from time to time and decide on related issues.
While the government invited bids for 74 percent stake in the national carrier, it could not get any bids in the preliminary round even after extending the bid deadline twice. The government then had decided to attempt divestment after global economic indicators stabilise.As per the provisional figures of FY 2018-19, the total debt of Air India Ltd as on March 31, 2019, is Rs 58,351.93 crore. While no party has come forward till now to show official interest in Air India, IndiGo has maintained that it finds the international segment of the carrier lucrative.