Saturday, June 29, 2019

Air India divestment: Government officials working on finalising draft preliminary information memorandum

The government is working on finalising a draft preliminary information memorandum for divestment of national carrier Air India and the new Air India Specific Alternative Mechanism is expected to soon hold a meeting to approve the same, sources aware of the development told CNBC-TV18.

As divestment of Air India is part of the 100-day agenda of Modi government, the preliminary information memorandum is expected to be floated next month, said sources. The government is mulling to divest 99-100 percent stake in the debt-ridden carrier, sources added.

As far as the employees are concerned, internal calculations of the airline show that over 90 percent of the employees will be retired around 2021, after which around 1,000-1,500 employees will be with the airline.

The carrier is also looking to activate 19 of its grounded planes by the end of September to add more flights in domestic and international space.

"We are planning to revive two B787s very soon, four B777 by  August and 13 A320s by end of September...these will be used in flights to Nairobi, Toronto, Bali and others," a person aware of the development said, adding that an estimated Rs 1,000 crore has been spent on maintenance of these 19 planes, which have been grounded for over a year now.

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.
28/06/19 CNBC TV18
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