Government on ‘wait and watch’ mode in Air India stake sale: Nitin Gadkari

The government has decided to “wait and watch” for the next three-four months before taking a call on disinvestment of national carrier Air India due to prevalent market condition specially high fuel prices, Union Minister Nitin Gadkari said. The government’s proposed stake sale in Air India failed to attract any initial bidder when the deadline for bidding ended on May 31.

“Market condition is not right for Air India disinvestment now. In view of this we are keeping a wait and watch policy for the next three to four months,” Gadkari, who holds multiple portfolios such as road, transport, highways, shipping and water resources, told here.

The minister said given the high fuel prices at present, the viability of the move will be judged before going ahead with the disinvestment process.

Under the Air India disinvestment plans, the government was to sell 76 per cent stake in the national carrier along with complete divestment of low-cost arm Air India Express and a 50 per cent stake in Air India SATS Airport Services Pvt Ltd — an equal joint venture with Singapore-based SATS.

Earlier, Minister of State for Civil Aviation Jayant Sinha had said the government was committed to strategic disinvestment of Air India. “What the modalities are, what the circumstances are, we have to monitor and evaluate as we go along,” he had said.

At the end of March 2017, the carrier had a debt burden of around Rs 48,877 crore. Of the total amount, Rs 17,360 crore was related to aircraft and Rs 31,517 crore pertained to working capital loans.

In May, Air India’s market share stood at 12.8 per cent.