Mumbai, Dec 27 (IANS) The Centre has prepared a revival plan for Air India, comprising a comprehensive financial package and sale of non-core real estate assets.
“The government has prepared a revival plan of Air India which focuses on building a competitive and profitable airline group,” the Minister of State for Civil Aviation Jayant Sinha said in a written reply to a question in Lok Sabha.
According to the minister, the plan comprises several major elements such as a comprehensive financial package including transferring of non-core debt and assets to a SPV (special purpose vehicle) and strategic disinvestment of subsidiaries.
The plan also envisages higher levels of operational efficiency being attained by the airline by strengthening its management and adopting differentiated business strategies for each of the airline’s core businesses.
Answering another question in Lok Sabha the minister stated: “The government remains committed to the disinvestment of Air India (AI). In this regard, AISAM (air india specific alternative mechanism) has directed to separately decide the contours of the mode of disposal of the subsidiaries.”
“Further, AISAM has, inter-alia, approved the contours for sale of subsidiaries of AI and directed to expedite the sale of AIATSL.”
The revival plan comes after government’s efforts to off-load a majority stake in the airline failed. On May 31, 2018 “no response” were received by the government.
On December 20, 2018, the Centre sought Parliament’s nod to infuse Rs 2,345 crore into the financially strained national carrier under its ‘Turn Around Plan’.
Further, the government sought the Parliament’s nod for providing Rs 1,300 ‘Grants-in-Aid General’ to Air India Asset Holding which is a Special Purpose Vehicle on to which AI’s debt worth Rs 29,000 crore will be loaded.
In addition, an inter-ministerial panel has decided to divest the government’s stake in AIATSL.