The government today declared that the debt-ridden national carrier Air India is willing to transfer management control along with 76 percent equity. The divestment will be done through open, competitive bidding. However, the divestment triggered vehement protests from the opposition.
The national carrier has been supported by public money for years, failing to incur profits for more than a decade. Towards the end of 2016-17, the airline has reportedly incurred a debt of almost 49,000 crores. By the end of the current financial year, its debt is expected to go up by another Rs. 3,500 crore. So, the government has expressed an Interest to transfer management control and multinational consultancy firm Ernst & Young was appointed as the advisor.
The opposition, which earlier accused the government of “not caring” about the national carrier, was up in arms. Trinamool Congress chief Mamata Banerjee made an emotional appeal:
I am sorry to read in the media about the Govt inviting expression of interest for selling Air India, the jewel of our nation. We strongly oppose this and want this order to be withdrawn immediately. This Govt must not be allowed to sell our country
— Mamata Banerjee (@MamataOfficial) March 28, 2018
Trinamool Congress leader Derek O’Brien raised a question on how such step could be taken when a Parliamentary Committee is still examining the divestment proposal.
“The proposed disinvestment of Air India is still being examined by the Parliamentary Standing Committee of Transport Tourism & Culture. Stakeholders are being called. Views heard. Report still some time away. How come these moves from Govt?” his tweet read.
The committee last year recommended that the government to put the decision on hold till 2022, when the 10-year turnaround plan ends. The committe also pointed out that the airline has now made Rs. 105-crore operating profit following its merger with Indian Airlines, and suggested to give more time to the Airline to recuperate.
Days later, the Union Cabinet cleared the decks for the disinvestment.
Under the new plan, the government will retain 24 per cent stake in Air India and its subsidiary Air India Express. It also proposes divesting 50 per cent of its stake in Air India Sats Airport Services.