Air India: Centre is committed to stake sale, but has no plans to exit completely, says Jayant Sinha
The minister of state for civil aviation said the present environment is not conducive to disinvestment.
Union Minister of State for Civil Aviation Jayant Sinha on Wednesday said that the government is committed to the disinvestment of Air India but has no plans to completely exit the national carrier, PTI reported.
The proposed 76% stake sale in the debt-laden airline has failed to take off as it did not receive any expressions of interest from potential bidders before the deadline on May 31.
“In view of volatile crude prices and adverse fluctuations in exchange rates, the present environment is not conducive to stimulate interest amongst investors for strategic disinvestment of Air India in the immediate near future,” Sinha said in the Rajya Sabha on Wednesday.
Sinha said the disinvestment plan “would be revisited once global economic indicators, including oil prices and forex conditions stabilise”. The airline’s total cumulative losses stood at Rs 47,145.62 crore in financial year 2016-17, according to audited accounts.
Sinha said Air India has been making losses since its merger with Indian Airlines in 2007. He listed high interest burden, increase in competition, high airport user charges and impact of exchange rate variation among the major reasons for the losses.
On Tuesday, the Centre sought approval from the Parliament to sanction Rs 980 crore as a supplementary grant to invest in equity shares for Air India during the 2018-’19 financial year.
On Monday, reports said that Air India had requested additional equity from the government worth Rs 2,121 crore for the financial year 2018-’19 in order to pay off its vendors. Air India owes about Rs 1,800 crore to its vendors.