- Government will soon revive the sale of its money-losing flag carrier
- It doesn't intend to insist on keeping 24% of Air India, official said
- Air India is surviving on taxpayer bailouts after losing money for years
Prime Minister Narendra Modi's administration is ready to "re-examine" its privatisation process, including a clause requiring a minority state stake in Air India Ltd., said Subhash Chandra Garg, a senior official in the Ministry of Finance. The government is considering various options and doesn't intend to insist on keeping 24 percent of the company, he said.
"A certain kind of strategy was offered that didn't find many takers and therefore something different will have to be done," Economic Affairs Secretary Garg said in an interview in New Delhi on Monday. "There's no fixed objective that government should have 24 percent. It can be re-examined."
PM Modi's most high-profile privatisation plan ended in a whimper on May 31 as a deadline for prospective suitors passed by with none showing interest in the airline mired in almost $8 billion of debt. IndiGo, the nation's biggest carrier, initially said it was keen but pulled out after the government made it clear it wasn't selling Air India's international operations separately.
The state retaining a stake in the airline -- already expected to lose as much as $2 billion over the next two financial years -- left open the "prospect of political interference on strategic and day-to-day matters," the Sydney-based CAPA Centre for Aviation said this month.
Air India, which was offered along with $5 billion of its debt, is surviving on taxpayer bailouts after losing money for years. Previous attempts by the government to dispose of the carrier were derailed by political opposition.