Union Civil Aviation Minister Hardeep Singh Puri has made it clear that if Air India is not privatised, it will be difficult to run it. He said there was no money to run it.
Talking to news agency ANI in the Parliament complex, Puri said, “If we do not privatise Air India, where will we get the money to run it? Air India is a first-class asset and, if sold, we will get bidders. Honestly, it is really difficult to run it.”
The Disinvestment Committee had decided that the government should exit the business of Air India completely. The government also is considering loosening the eligibility criterion for potential bidders so that new companies and high net worth individuals (HNIs) are able to participate in the sales process.
Earlier in the Rajya Sabha, the Union civil aviation minister had said that Air India pilots were being taken care of and not a single pilot had resigned. Puri said the Air India pilots’ salaries were more than commensurate with the industry rates. He said that only 25% of the salary of some employees had been withheld. “This part will be given to all employees before disinvestment,” the minister assured.
For a long time, the Narendra Modi government has not been able to finalise whether it should go for strategic sales of Air India’s stakes or sell it fully.
The government once said it could allow up to 49% FDI in Air India, but it is infamous for bowing down to the demands of Sangh Parivar elements like the Swadeshi Jagaran Manch that just wouldn’t allow foreign investment anywhere.
Kind of debt Puri is staring at
Air India incurred a huge loss of Rs 8,400 crore in the financial year 2018-19. The state-run airline is already struggling with a shortage of funds and is burdened with debt.
The company has incurred huge losses due to higher operating costs and foreign exchange losses. A new airline can be started with the amount of loss Air India incurs in a year.
Air India currently is burdened by a debt of around Rs 60,000 crore, including long-term loans for the purchase of aircraft and working capital.
What happens to caste quota after privatisation?
What will be the rule of reservation for Air India employees after privatisation? To this question, Puri said that it often so happened that most of the old employees remained post-privatisation.
Thereafter, Puri added, the government wouldn’t interfere in new recruitments. In 2018, the first Modi government had said it could absorb the existing employees in other PSUs.
This is not the first time Puri has spoken of the government’s “commitment” to disinvest Air India.