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Air India privatisation plan shelved
News:
- The central government has decided to postpone the plan to disinvestment of Air India.
Important Facts:
- The central government has decided to privatize Air India by inviting a bid process in March 2018.
- The government had offered to sell:
- 76% of its stake in Air India
- 50 % of share of low-cost subsidiary Air India Express in ground-handling arm AISATS as a single entity.
- The government has delayed the disinvestment process due to:
- The rising fuel prices
- The government has not received any bids.
- Issues:
- Huge Debt and liabilities which accounts for approx. 33,000 crore
- The government continuation with ownership.
- Lack of clear road map.
- Obligation and benefits issue related to permanent and contractual employee.
- Plan of action to revive of Air India include:
- Improving Efficiencies by bringing private people to work with the airline
- Cutting down costs.
- Monetisation of Air India assets.
- Conclusion
- The focus should be restructuring of airline under a special administration to overcome the losses.
