NEW DELHI :
Air India's chairman and managing director Ashwani Lohani has informed the airline's employees that the government's plans to divest its stake in the national carrier is the viable alternative for the survival of the loss-making airline and sustain its operations under private hands.
In a letter dated 7 November addressed to the employees of the national carrier, Lohani also added that the management of the airline is taking adequate steps to protect the interest of the employees after the divestment process.
A copy of the letter has been reviewed by Mint.
It must however be noted that a similar effort to privatize the airline in 2018 by the government failed to attract even a single bidder.
Air India’s net debt swelled from ₹55,000 crore at the end of March 2018 to ₹58,351.93 crore at the end of March 2019. This includes working capital and aircraft-related debt.
"As you are well aware, Air India is going through an extremely stretched financial situation primarily due to huge debt servicing liabilities that has been affecting the airline," Lohani said.
"The position gets compounded due to legacy issues and the constraining environment that being a PSU (Public Sector Enterprise) we are forced to live with," he said in the letter.
"You would appreciate the above scenario constrains our sustainable survival with divestment perhaps emerging as viable alternative," Lohani added.
The government plans to shortly invite bids to sell its entire stake in Air India, after potential buyers baulked at an initial attempt to divest a partial stake in the airline with the government retaining a minority stake in it. The expression of interest document for the privatization process is likely to be finalized by November-end, government officials had earlier told Mint.
In the latest attempt, the government may ease rules, which currently allow foreign carriers to own only up to a 49% stake in an Indian airline.
"It is natural that many of you would be concerned about the future in the light of the divestment scenario as any change in ownership brings about change in the work culture and environment," Lohani said in the letter adding that the management of the airline shares the concerns of the staff.