Lok Sabha Question No. 3061 (UNSTARRED), answered on 2019-07-11
Subject: Status of Privatisation of Air India
Ministry: CIVIL AVIATION
Asked by: Bhartruhari Mahtab, Rajendra Dhedya  Gavit, Rahul Ramesh Shewale

## GOVERNMENT OF INDIA MINISTRY OF CIVIL AVIATION LOK SABHA

UNSTARRED QUESTION NO\_ :3061 (To be answered on the Ith July 2019)

## STATUS OF PRIVATISATION OF AIR INDIA

3061.

SHRI BHARTRUHARI MAHTAB SHRI RAJENDRA DHEDYA GAVIT SHRI RAHUL RAMESH SHEWALE

Will the Minister of CIVIL AVIATION

be pleased to state:-

- (a) whether the Government proposes to privatise Air India and if s0, the details and the present status thereof;
- (c) the quantum of debt decreased/increased and profits earned/losses incurred by the Air India during each of the last three years and the current year;
- (b) whether the Government has received any representations from various quarters including Air India Unions to not privatise Air India and if the details thereof along with the reaction of the Government thereto; SO,
- (d) the capital infused by the Government in to Air India during the said period; and
- (e) the steps taken/being taken by the Government to revive Air India and to protect the interests of its employees in case of its privatisation?

## ANSWER

Minister of State (IC) in the Ministry of CIVIL AVIATION

(Shri Hardeep Singh Puri)

(a): The Government is committed to the strategic disinvestment of Air India: The Cabinet Committee on Economic Affairs (CCEA), in its meeting held on 28.06.2017, had given an in-principle approval for considering Strategic disinvestment of Air India and its subsidiaries.

After no bid was received for strategic disinvestment of Air India by the last date i.e 31.05.2018, the Air India Specific Alternative Mechanism (AISAM) in its meeting held on 18.06.2018, had, inter-alia, decided that in the meanwhile:

i) all near medium term efforts should be made to capture operational efficiency and to improve performance of Air India,

- ii) the non-core land and building assets, that have already been identified

should be monetized, iv) the services of extant advisers should be used to carry out above mentioned activities.

iii) the assets could be shifted to Air India Assets Holding Limited s0 as to retire the debt of Air India and

Government has also directed Air India Limited to financials of Air India and its subsidiaries finalized. Further, an AISAM with new members 0n its re-constitution will finalise the parameters for disinvestment of Air India: get

- (b): Joint Forum of Air India Unions/Associations /Guild/ Federation/Trust; vide their letter dated 12.06.2019 to Air India, has expressed its protest against the privatisation of Air India: However; no official communication has been made by the Management of Air India regarding the same
- (c): The details of the total Debt and Net Losses of Air India of the last 3 years and the current year are given hereunder (Rs in Crore):
- (d): The details of the funds infused into Air India by the Government during the last 3 years and current year are aS under (Rs in Crore)
- (e): Government prepared a Revival Plan for Air India which included a comprehensive financial package The Revival Plan of Air India focuses on the operational efficiencies so that substantial increase in revenue or cost saving can be achieved: The Revival Plan, inter-alia, comprises several major elements including:
- (i) Higher levels of operational efficiency by strengthening management and implementing best practice business processes
- (iii) Differentiated business strategies for each Air India's core businesses
- (i) Robust organizational and governance reforms to be implemented by an eminent Board
- (iv) World-class HR practices to ensure a talented and motivated workforce and
- (v) Sale of non-core real estate assets and strategic disinvestment of subsidiaries such as Air India Air Transport Services Ltd. (AIATSL)

| Year    | Net Loss       | Total Debt      |
|---------|----------------|-----------------|
| 2018-19 | 7635.00(prov:) | 58351.93 (Prov) |
| 2017-18 | 5348.18        | 55308.52        |
| 2016-17 | 6452.89        | 48447.37        |
| 2015-16 | 3836.78        | 52817.02        |

| Year    |   Amount |
|---------|----------|
| 2018-19 |  3975    |
| 2017-18 |  1800    |
|         |  2465.21 |
| 2015-16 |  3300    |

Further even as the Government is committed to the disinvestment of Air India,, the Government has approved a Revival of Air India with financial support The   financial support; inter-alia, includes a cash support of Rs. 3975 crore to Air India, transfer of debt amounting to Rs. 29464 crore from Air India Limited to Special Purpose Vehicle (SPV) i.e Air India Assets 7600 crore to Air India Limited and Rs.1300 crore to SPV to meet the interest for Q3/Q4 of Financial Year 2018-19 on the debt transferred to the SPV. Also, the entire debt on the SPV debt would be serviced by the Government from Financial Year 2019-20 for which Rs. 2600 crore has been provided: plan

Further; an AISAM with new members 0n its re-constitution will finalise the parameters for disinvestment of Air India: