Thursday, June 29, 2017

Air India set to shed flab as cabinet approves disinvestment of public carrier, GoM to look into method

With mounting loss of state-run carrier Air India touching unrealistic heights, the Centre in an attempt to rid itself free of the unproductive behemoth has in-principle given the nod for its divestment paving the way for privatisation of the airline, Union finance minister Arun Jaitley said on Wednesday.

"In-principle approval for Air India divestment has been given. The civil aviation ministry's proposal for the formation of a group under the chairmanship of the finance minister to decide the modalities of divestment process has also been accepted," he said.
The government will form a group of ministers to look into the disinvestment process of the public carrier and how to go about it.
Surviving on taxpayers' money, Air India has been in the red for long and various proposals, including government think tank Niti Aayog's suggestion for complete privatisation, have been made.

The airline has a debt of more than Rs 52,000 crore and is surviving on a Rs 30,000 crore bailout package extended by the previous UPA government in 2012.

According to The Hindu, the Union cabinet was supposed to decide the fate of the state-owned carrier Air India by deliberating on three options to divest the government’s majority stake and consider the creation of a special purpose vehicle (SPV) to get rid of a major portion of its more than Rs 50,000 crore debt.
28/06/17 First Post