New Delhi: India is set to examine the possibility of selling up to 49 per cent of loss-making national carrier Air India, news agency NewsRise Financial reported today, citing an unnamed official.
The government plans to form a four-to-five member panel, made up of officials from the finance ministry, the civil aviation ministry, the cabinet secretariat and the company, to consider selling a stake in Air India to meet its revenue target from state asset sales next fiscal year, it said.
However, the government denied any move to consider selling stake in the national carrier Air India.
Indebted Air India, which last made an annual profit in 2007, has seen its market share shrink in recent years amid rising competition from private carriers. It is now India's third-largest airline by market share.
The government will have decided to divest 49 percent in the company as foreign airlines cannot pick up stake in an Indian carrier, said Kapil Kaul, CEO - South Asia, CAPA. He, however, added while privatization of Air India -- whether it is 49 percent or 51 percent -- is a must even though he was doubtful it would be done.
"After all, how long can you fight taxpayer money with private money," he said. Kaul added that now was a good time to prepare a roadmap for the national carrier's privatization given that it seems to be on track for posting profits.
Air India executives said they were not aware of any such decision.