Indian Government is looking forward to divest the state-owned Air India in parts to make it appealing to potential purchasers. Modi’s cabinet of ministers gave a green signal a month ago for the government for selling the airline, after billions of funds spent by the government to keep the business on go.
Air India, established during 1930s, is burdened with a debt of $8.5 billion. The legislature has invested $3.6 billion since 2012 to keep the airline running. Once Air India was the country’s biggest transporter but its piece of the overall industry in the domestic market dropped to 13% as private airlines, for example, IndiGo and Jet Airways have developed.
The course of events is very complicated, with the government considering whether it should hold a stake or exit totally, or should it chance being left with the unfruitful pieces while purchasers pick off the better part of the deals.
Nobody has appropriately evaluated the organization’s different assets and resources recently. Chairman of the Mumbai office, Ashwani Lohani said that in the previous month, about $30 million worth of art, including works by famous artist M. F. Husain, disappeared from its Mumbai office.
Authorities who are in charge of the sale are baffled due to the sheer size of the problem. Airline in question has six subsidiaries, three of which are incurring losses, resources worth about $4.6 billion. It has an approximated $1.24 billion worth of land, including two lodging hotels, possession of which is divided among different government institutions.
Past endeavors to offload the airline have been unsuccessful. If Modi can remove this burden from the government it will benefit him greatly. He will be known to overcome one of the nation’s most unmanageable issues till date. According to authorities, PMO has set a due date of one year from now to get the deal procedure in progress, the authorities stated.