The Centre, which has been actively pursuing the process of Air India divestment, wants to complete the sale of the state-owned airline by the end of the current financial year, a Reuters report said quoting a top finance ministry official. The Narendra Modi government has also lined up the sale of two other public sector enterprises—Bharat Petroleum Corp (BPCL) and logistics firm Container Corp of India—to be completed by March 2020.
A cash-strapped Centre is looking to receive Rs 60,000 crore from the sales, the senior Finance Ministry official said on conditions of anonymity. Potential buyers would include local or foreign firms as the PMO was not in favour of stake sales in one state entity to another. The news comes amid Finance Minister Nirmala Sitharaman stating on Sunday that disinvestment in Air India was on track and the group of ministers (GoM), headed by Home Minister Amit Shah would meet this or next week.
The official added that the finance ministry's move to sell Hindustan Petroleum (HPCL) to ONGC was met with reservations from the PM's office. “The PMO is very clear that we cannot be selling government companies to another government company and then call it privatisation,” the official said.
The government's bid to find takers for Air India had failed to attract any bids last year. Following this, the Centre is preparing a fresh proposal after the Modi government took office in May. Media reports said that the Committee of Secretaries has proposed that the government fully quit the carrier as a 24 per cent holding of the government was one of the major reasons cited by transaction advisor EY on why bidders stayed away.
The government's aim to get a private player to buy Air India has been met with stiff opposition from the various unions of the airline as well as the RSS, the parent organisation of the BJP.
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Earlier, it was reported that the government was considering foreign airlines among potential buyers. Reportedly, the preliminary bids were expected to open by October 10.
It is no secret that Air India divestment remains one of the most important agenda for the current government. On Thursday, a group of ministers (GoM), led by Shah, met in Delhi to work out modalities for the sale of Air India which has a debt burden of over Rs 58,000 crore. Sitharaman, Commerce and Railway Minister Piyush Goyal and Civil Aviation Minister Hardeep Singh Puri also attended the meeting.
In 2018-19, Air India incurred losses of around Rs 7,600 crore. By the end of 2018-19, it had a debt burden of around Rs 58,300 crore.
