Wednesday, November 27, 2019

PM Modi to consider excluding Air India’s $7 billion debt to lure buyers

New Delhi: Sources have said that the Central Government is considering a plan to exclude more than half of Air India Ltd’s $11 billion of debt in their latest test attempt to lure investors to the struggling carrier.
Prime Minister Narendra Modi’s government plans to ask proposed investors to take over Rs 30,000 crore of the airline’s debt, which are backed by the carrier's aircraft, sources said. The Government may call for the so-called expression of interest as early as December 15, they added.
Modi’s administration, which failed to attract any bidder for the carrier last year, is keen to sell the company to help bridge a widening fiscal deficit following dismal tax collections and cuts to corporate tax rates worth $20 billion. Last week, the Central Government decided to sell its entire stake in the country’s second-largest state refiner, and its biggest shipping company.
Unprofitable for a decade with taxpayers bailing it out repeatedly, Air India’s appeal to any investor is contingent on the governments ability to write off the debt not backed by assets. “The Government has pumped in Rs 56,000 crore in the last past decade in a bid to keep the carrier afloat,” sources said.
27/11/19 Bloomberg/Business Line
To Read the News in full at Source, Click the Headline


Post a Comment