Air India privatisation is set to turn into reality after the Narendra Modi led Cabinet took the decision to offer a stake sale in the debt hit national carrier. Considering that the debt is to the tune of $8 bn and counting, and the government not indicating whether it will write that off, the news was not exactly cheered by India Inc, one of whom is eventually expected to emerge as the buyer. Amongst the first to react to the news was none other than chief of Mahindra Group, Anand Mahindra who on Thursday took to Twitter to say that that he does not have enough courage to buy Air India. The billionaire made it clear that he was not in contention and ruled out the possibility of his company auto major Mahindra and Mahindra buying the beleaguered national carrier. Mahindra wrote, “I see myself as a generally courageous person.. But I confess .. I don’t possess THAT much courage.”
I see myself as a generally courageous person…But I confess..I don’t possess THAT much courage… https://t.co/OFPdoYuloq
— anand mahindra (@anandmahindra) June 28, 2017
The Union Cabinet on Wednesday gave the green signal for the privatisation of the national carrier and its five subsidiaries, as reported by PTI. With an “in-principle” approval, a group of ministers will now decide the final modalities of the sale. Reports have been circulating that the best option would be for the Tata Group to buy the ailing airline, which it owned before the carrier was nationalised nearly 70 years ago. However, even though Tata is yet to comment on the same, Bharti Enterprises chief Sunil Mittal recently suggested that Bombay House, Tata’s headquarters, would be the ideal buyer.
Air India has the largest domestic and long-haul fleet of 140 planes in the country and flies to nearly 41 international and 72 domestic destinations. Once the country’s monopoly airline, Air India has lost market share to the flashy new low-cost private carriers. The airline was on a Rs 30,000-crore bailout package issued by the United Progressive Alliance (UPA) government in 2012 and so far it has received Rs 24,000 crore, as per the reports.
Finance Minister Arun Jaitley, who will head a panel to decide the size of the stake sale and treatment of assets and debts said, “How much will be disinvested, by which process, its assets and debt, as also its hotel companies, will be deliberated.”