Prime Minister Narendra Modi’s government will set a panel for reviewing plan of selling Air India after his administration highest profile privatization proposal ended in a shock of no buyer showing interest in non-profitable flag carrier.
If necessary, the government will make changes in the plan, Economic Affairs Secretary Subhash Chandra Garg said. As the deadline to show preliminary interest expired on Thursday, no bidder came forward to propose purchasing 76 percent of Air India Ltd., which was offered along with $5 billion debt.
Aviation Secretary R.N. Choubey told that the process for the next step will start in two weeks. We were certainly hoping forward for a better participation.
Failure is a setback on Modi’s reformist image before the national elections next year. In the last two decades, Air India lost to carriers like Singapore Airlines and Emirates that increased flights in India, World’s fastest growing major aviation market. The lack of interest also means that the government is stuck with an enterprise which has left on the taxpayer money for the last decade.
Interested parties bowed over those conditions when the government made it clear that it did not want to sell Air India in parts. Indigo’s country’s largest airline and initial buyer pulled out in April this year. Some media reported that Singapore Air, Qatar Airways and Tata Group were potential bidders, but no one was finally seen.
Air India fleet includes more than 100 Boeing Co. and Airbus SE aircraft that make more than 2,300 local flights weekly to 54 airports and it has 2,543 landing slots at the airport including New York, London, Paris and Tokyo.
The Indian government had tried earlier to sell the carrier but those efforts were stopped after the political opposition.