Civil Aviation Minister Hardeep Singh Puri said that Air India Specific Alternative Mechanism (AISAM) has approved 100 per cent sale of government stake in Air India for the re-initiated strategic disinvestment of the national carrier. "After the formation of new government, Air India Specific Alternative Mechanism (AISAM) has been reconstituted and the re-initiation of the strategic disinvestment of Air India has been approved. AISAM has approved the 100 per cent sale of government of India stake in Air India for the re-initiated Strategic Disinvestment of Air India," Mr Puri informed Lok Sabha.
Puri further stated that to improve the aviation sector, the central government has taken following measures - in-principle approval for leasing of six airports of Airports Authority of India (AAI) under Public Private Partnership (PPP) accorded, out of which Letter of Award for leasing the airports of Ahmedabad, Lucknow and Mangaluru has been issued by AAI; Rationalized taxes on jet fuel by many states, exempted customs duty on tools and toolkits, reduced GST on various spare parts, accessories and consumables. He mentioned that the government has enabled the swift transition of aircraft of Jet Airways to other airlines.
Also, the contract for e-governance in DGCA (e-GCA) has been awarded and five-year restriction on new airlines for flying on international routes has been removed. "AAI has embarked upon a capital investment of over £2.5 bn in next five years for development/ upgradation/ modernization of various airports and air navigation infrastructure," the Union Minister stated.
AI seeks sovereign guarantee
Cash-strapped Air India has sent an SOS to the government, seeking immediate sovereign guarantee for raising £240 as fresh loan to keep flying till outcome of the second divestment process is known. The management sent a note to aviation secretary P S Kharola, who was earlier the airline chairman, requesting urgent action on this request.
“Ever since aviation minister H S Puri made a statement in Parliament on November 27, 2019, that ‘AI will shut down if not sold off,’ everyone we owe money to has been asking for payment. We have reached a stage where it is becoming very difficult financially to continue. We need continued services/supplies as a functional airline, but people are now saying clear or reduce past dues first. We have requested the government to enable us to raise fresh loan of Rs 2,400 crore by giving us sovereign guarantee to be able to keep flying,” said people in the know. The airline is yet to pay November salary to employees.
AI has a total debt burden of close to £7.4 bn — that includes nearly £6 bn of aircraft and working capital debt and £1.4 bn of net current liabilities or payables. A major Gulf carrier has also hinted it could look at AI if the employees’ issue is sorted out. “If a very strong player makes a bid for AI, employees will seek a very hefty sum as golden handshake,” the Gulf carrier’s top boss had recently said.
