Cabinet clears Air India’s sell, trade unions cry foul
The Cabinet today cleared disinvestment of beleaguered national airline, Air India which has floundered amid stiff competition from no-frills rivals and reported at least seven years of losses.
Announcing the decision, Finance Minister Arun Jaitley said an in-principal approval for divestment of Air India has been taken, but did not say if it will be an outright sale or partial divestment.
“The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Narendra Modi, has given its approval to fourth tranche recommendations of NITI Aayog on strategic disinvestment of CPSE (strategic disinvestment of Air India and five of its subsidiaries) based on the recommendations of Core Group of Secretaries on Disinvestment (CGD),” he said.
A Civil Aviation Ministry note for stake sale in Air India was considered by the Cabinet today.
The airline, which was afloat thanks to a Rs 30,231 crore nine-year bailout programme approved in 2012, has about Rs 52,000 crore of debt. It is hampered by debt and servicing costs, which largely eroded its recovery.
Air India, which made an operating profit of about Rs 100 crore in 2015-16 on back of drop in oil prices, but posted a net loss of Rs 3,840 crore, has seen its market share shrink …read more