Union Minister of State for Civil Aviation Jayant Sinha on Thursday told the Lok Sabha that the Centre has prepared a revival plan for state-owned carrier Air India. The plan includes a comprehensive financial package for the national carrier. Also, strong organizational reforms and differentiated strategies for the airline’s core businesses have been included in the plan.
Sinha claimed that the plan will focus on building a competitive and profitable airline network group in the country. The Centre sought a parliamentary approval last month for an equity infusion of Rs 2,345 crore in Air India. Also, approval was sought over providing grants-in-aid of Rs 1,300 crore to Air India Asset Holding which is a special purpose vehicle designed to privatize the ground handling transport business of Air India. The revival plan will include the transfer of non-core debt and assets to the special purpose vehicle.
Sinha also said that the amount of revenue likely to be generated from monetizing the land and properties depends on the bid process and is also subject to no-objection certificates from the authorities concerned.
Sinha declared in a written reply that the government is committed to the disinvestment of Air India, which is estimated to have a debt worth over Rs 55,000 crore.
Air India has reportedly planned to monetize its unutilized and surplus immovable real estate assets over the next few years. The airline has till now realized an amount of Rs 410 crore by disposing of its non-core assets in various cities in India and abroad. It has also realized a rental income of Rs 314 crore approximately.
The central government in March had planned to divest a 76% stake in Air India ignoring the parliamentary panel’s recommendation which suggested to give the cash-strapped airline 5 years to revive itself. The Centre, however, could not carry out the plan because it did not receive much interest from potential bidders by the end of the deadline.