Aviation ministry infighting likely to derail AI stake sale

New Delhi: Differences within the civil aviation ministry could derail the government’s plan to induct a strategic partner in troubled national carrier Air India.
Those in favour of strategic sales argue that government do not have the resources to support the airline, which is expected to post a net loss of Rs 5,400 crore this financial year.
The move is facing stiff resistance from another group of officials who say that the airline is unlikely to get a good valuation and it may not be wise to go in for a strategic sale at present.
Strategic sale could also face political opposition. “Any move to rope in a strategic investor would give the impression that the government is selling Air India to private carriers,” said an official opposing the move.
The option of strategic sale has found many backers as it is increasingly being felt that it is not possible to turn around the airline under government ownership.
“Many important steps such as downsizing and pay cuts cannot be effectively implemented in a public sector environment” said an official in favour of stake sale.
26/03/10 Nirbhay Kumar/Economic Times

To Read the News in full at Source, Click the Headline

Categories: NACIL Mar 2010