No immediate plan to divest our stake in Air India: Govt
6 March 2015 1:03 AM GMT
Talking on the issue of getting a strategic partner for Air India, he said, “There was no proposal at present to either look for a strategic partner for Air India or to divest government’s stake in it. Instead, for the next six months the ministry will focus on making sure that the airline’s on-time performance is back on track.”
Ruling out any immediate plan to divest stake in Air India or rope in a strategic partner for the national carrier, the minister said the focus was on the “the airline’s on-time performance, which has already gone up in the last few weeks.”
He said that the country needs a a strong national airline, noting that it was important to have flag carrier in the country. Sharma added that, “The government was committed to pumping in the allocated funds in Air India as part of its turnaround and financial restructuring plan, approved by the then UPA dispensation in 2012.
However, the government in the recently approved budget has allocated only Rs 2,500 crore for the national carrier against a demand of Rs 3,384 crore for the next fiscal.
An official of the ministry said that the civil aviation ministry would soon approach the finance ministry to provide the shortfall of Rs 1,900 crore, including Rs 1,000 crore of the current fiscal via Supplementary Demand for Grants. He also said Air India’s losses have decreased in 2014-15 due to lower crude oil prices and less currency fluctuation compared to 2013-14.
Industry and aviation experts have long been demanding privatisation of Air India citing huge losses being reported by it, though the financial condition of the private carriers is also not quite good.
Kingfisher Airlines lost its licence in 2012, while Jet Airways and SpiceJet are also running into losses.
IndiGo’s profit went down by more than half in the previous fiscal over FY-13, while another private airline GoAir reported just about Rs 5.5 crore profit in the last fiscal.
Ruling out any immediate plan to divest stake in Air India or rope in a strategic partner for the national carrier, the minister said the focus was on the “the airline’s on-time performance, which has already gone up in the last few weeks.”
He said that the country needs a a strong national airline, noting that it was important to have flag carrier in the country. Sharma added that, “The government was committed to pumping in the allocated funds in Air India as part of its turnaround and financial restructuring plan, approved by the then UPA dispensation in 2012.
However, the government in the recently approved budget has allocated only Rs 2,500 crore for the national carrier against a demand of Rs 3,384 crore for the next fiscal.
An official of the ministry said that the civil aviation ministry would soon approach the finance ministry to provide the shortfall of Rs 1,900 crore, including Rs 1,000 crore of the current fiscal via Supplementary Demand for Grants. He also said Air India’s losses have decreased in 2014-15 due to lower crude oil prices and less currency fluctuation compared to 2013-14.
Industry and aviation experts have long been demanding privatisation of Air India citing huge losses being reported by it, though the financial condition of the private carriers is also not quite good.
Kingfisher Airlines lost its licence in 2012, while Jet Airways and SpiceJet are also running into losses.
IndiGo’s profit went down by more than half in the previous fiscal over FY-13, while another private airline GoAir reported just about Rs 5.5 crore profit in the last fiscal.
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