The Centre will go ahead with the process of disinvestment of Air India, Civil Aviation Minister Hardeep Singh Puri said on Thursday. “Continued support from the government has resulted in an improvement of the financial and operational performances of Air India,” he said in a tweet.
This is a sharp departure from what the Centre had decided in 2018. During a meeting of the Air India Specific Alternative Mechanism on March 28, 2018, it was decided that the atmosphere was not conducive for the disinvestment. Things like volatile crude oil prices and adverse fluctuations in exchange rates were taken into consideration.
“But this was last year,” said Puri.
Earlier on Thursday, however, he had reportedly told Parliament that the present economic environment was not conducive for the sale of the state-run carrier in the “immediate near future”, according to Mint. He had added that the government will revisit the sale once global economic indicators stabilise.
The Air India Specific Alternative Mechanism, or AISAM, which was set up by the Cabinet Committee on Economic Affairs for the strategic disinvestment of Air India and its five subsidiaries, will now be reconstituted. Arun Jaitley and Suresh Prabhu, who were part of the panel last year, are no longer ministers in the Narendra Modi government. Puri and Finance Minister Nirmala Sitharaman will replace them. However, transport minister Nitin Gadkari is likely to continue in the panel, according to PTI.
In March 2018, the government had planned to divest 76% stake in Air India, ignoring a parliamentary panel’s recommendation to give the debt-ridden airline five years to revive itself. The proposed stake sale, however, failed to take off as the Centre did not receive any expressions of interest from potential bidders by the end of the May 31 deadline.