The Indian government's decision to privatise Indian national carrier -- Air India -- may end up seeing the carrier's founder, the Tata Group, buying the airlines back from the Centre
With the Indian government looking at various options, including full or partial privatisation, to revive Air India, Tata Group has reportedly shown an interest in buying a buying a majority stake in debt-laden national carrier.
According to a report in Economic Times, the national carrier's founder, the Tata Group, is believed to have held preliminary and informal talks with senior members of the Narendra Modi government to buy back the airline, or the Maharaja as its often called.
Staying afloat on taxpayers' money, the airline has been in the red for long and various proposals, including government think-tank Niti Aayog's suggestion for complete privatisation, have been made.
There was no official word from the government but sources said the Civil Aviation Ministry is keen on retaining the national carrier status of Air India.
According to the report, Tata Group's top boss N Chandrasekaran is himself leading these informal talks with the government, and evinced an interest to buy up to 51% stake in the carrier.
The article quoted sources as saying that the Tata Group may try to rope in Singapore Airlines to buy the balance 49%, in case the Modi government would decide to completely privatise Air India.
Tatas had no comment. "We do not comment on such matters," a spokesperson at Tata Group said in an emailed statement.
One scenario being discussed is that the government would retain 51 per cent stake and the rest 49 per cent could be sold to private players, which could include foreign players. The government is also looking at various options such as selling off non-core assets to reduce the airline's debt burden.
For Tatas, it would be more of a home coming. Air India traces its roots to Tata Airlines, which was formed back in 1932. Set up by Tatas, the carrier was made a public company and was rechristened as Air India. Later, it was nationalised. Currently, Air India has a debt of more than Rs. 52,000 crore.
Recently, Finance Minister Arun Jaitley had said the aviation ministry has to explore all possibilities "as to how the privatisation of Air India can be done".
Tatas already have two airline joint ventures -- Vistara and AirAsia India.
(With Agency Inputs)