Ministry of civil aviation in India has decided to fully divest the stakes in Air India and its subsidiary. Air India is owned by the government of India and its subsidiary AISATS is a joint venture partnership between Air India and Singapore Airport Terminal Services (SATS) Limited.
In March 2018, the divestment plan in the airline failed since most buyers were wary of the government retaining a 24% stake in the airline. The government is set to hit INR1.05 trillion (US$14.7 billion) target once the airline deal is closed. The sale should also help the airline which has fallen behind private operators like IndiGo and SpiceJet.
The airline has been surviving on a rescue package, which was approved as a part of its Turn Around Plan (TAP) in 2012. Under the plan, the government has infused over INR 290,000 million (US$ 4,058 million) into Air India since then. But the airline is still making a loss. The company's net debt swelled to INR 583,519 million (US$ 8,165.5 million) at the end of March 2019 from INR 550,000 (US$ 7,696.4 million) at the end of March 2018, which includes working capital and aircraft-related debt.
The government wants to exit the loss-making business with the full privatization of the airline.