OPTIONS OPEN FOR AI REVIVAL: GOVT
NEWDELHI: The civil aviation ministry will come up with a road map for the rejuvenation of debtladen Air India Ltd within the next three months, a government official said on Tuesday.
The airline is currently running on a bailout package which has infused ₹25,000 crore over the past few years, and another ₹25,000 crore is expected over the coming decade.
“In the next three months, we expect there would be clarity on the way forward,” the government official, who did not want to be named, said.
The official, however, indicated this could be a long-haul process. “Now how much time that way forward will take, that’s a different thing,” he said about the execution of any new recommendations beyond the existing turnaround plan.
At a press conference organised to mark three years of the National Democratic Alliance government, civil aviation minister Ashok Gajapathi Raju said on Tuesday that government think tank NITI Aayog recently submitted its recommendations on Air India to the ministry. “NITI Aayog has made recommendations for making Air India strong and viable. All courses of action are being examined. We have not closed any option,” Raju told reporters.
Finance minister Arun Jaitley said over the weekend that the government was open to the option of bringing a strategic investor into the airline.
Raju did not elaborate on the recommendations, but said all possible alternatives would be looked into and no option had been closed as yet.
Qatar government-owned Qatar Airways has said it hopes to start an airline in India, Mint reported on January 24.
Raju denied there is any connection between Qatar’s interest and the government’s remarks on Air India’s potential disinvestment. “Let me tell you one thing—we are proud of Air India. This kind of speculation... we don’t like to put ourselves down,” he said.
The state-owned airline has a debt of about ₹50,000 crore, of which about $25,000 crore are loans taken to buy aircraft. Air India reported a loss of about ₹3,587 crore in 2015-16, compared with a loss of ₹5,859 crore in the previous fiscal year.
The Economic Survey 2017 recommended that the government privatise Air India.
Debt piled up and losses mounted at Air India following an aircraft deal worth $11 billion around 2005 and a botched merger with erstwhile domestic carrier Indian Airlines. The Central Bureau of Investigation (CBI) is probing what went wrong. Raju said the airline will cooperate with the CBI probe that would extend to the previous UPA government.
Air India is the single biggest global carrier from India with a 17% market share. It controls 14.6% of the domestic passenger market, which has eroded over time as private airlines expanded capacity.