Govt adopts 'wait and watch' approach on AI stake sale, says official
The government has decided to adopt a "wait and watch" approach for the next three to four months before taking a call on Air India disinvestment, a senior official said today.
The official also said the general view in the government is that the national carrier should be in the hands of Indian entities.
The government's proposed stake sale in Air India failed to attract any initial bidders when the deadline for bidding ended on May 31.
"We are keeping a wait and watch policy (on Air India disinvestment) for the next three to four months. The fuel prices are high at present and we have to judge the viability of going ahead with the disinvestment process," the official said.
He also noted that the aviation sector as a whole is facing difficult times, mainly on account of rising fuel prices.
"The government is also of the view that Air India should be in the hands of Indian entities," the official added.
Under the proposed plan, the government was to sell 76 per cent stake in Air India along with complete divestment of low-cost arm Air India Express and a 50 per cent stake in Air India SATS Airport Services Pvt Ltd -- an equal joint venture with Singapore-based SATS.
Last week, Minister of State for Civil Aviation Jayant Sinha had said the government was committed to strategic disinvestment of Air India. "What the modalities are, what the circumstances are, we have to monitor and evaluate as we go along," he had said.
At the end of March 2017, the carrier had a debt burden of around Rs 48,877 crore. Out of the total amount, Rs 17,360 crore was related to aircraft and Rs 31,517 crore pertained to working capital loans.
In May, Air India's market share stood at 12.8 per cent, as per latest official data.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.