Modi renews vow to sell Air India after last year’s botched attempt

Photographer: Dhiraj Singh/Bloomberg

India will revive plans to sell Air India Ltd., after an attempt to partially exit the loss-making carrier failed to find a single buyer last year.

The high-profile divestment would be part of Prime Minister Narendra Modi’s efforts to raise 1.05 trillion rupees ($15.3 billion) selling stakes in state-run companies, finance minister Nirmala Sitharaman said in her maiden budget speech on Friday. The administration will also look to sell other state-run companies or merge some of them, she said.

Modi’s Bharatiya Janata Party won a second term this year after pledging cash handouts to farmers and a $1.44 trillion plan to build roads and railways, besides measures to boost manufacturing and exports. While the promises resonated with voters, funding remains a challenge, forcing the government to sell assets.

“Strategic disinvestment would continue to remain a priority,” said Sitharaman, the first woman to hold the position. “The government would not only re-initiate the process of strategic disinvestment of Air India, but would offer more Central Public Sector Enterprises for strategic participation by the private sector.”

Air India, which is surviving on a 300-billion-rupee taxpayer-funded bailout, has failed to maintain its market dominance as a slew of carriers including InterGlobe Aviation Ltd. and SpiceJet Ltd. started to offer ultra-cheap, on-time flights more than a decade ago. The airline has total debts of $8.4 billion and posted losses of more than 76 billion rupees last year, according to provisional estimates.

A sale of Air India, which hasn’t made money since its merger with state-run domestic operator Indian Airlines Ltd. more than a decade ago, would boost Modi’s credentials as a reformer taking the state away from businesses.

The sale attempt last year ended in a whimper as a deadline for prospective suitors passed by with none showing interest in the airline. InterGlobe’s IndiGo, the nation’s biggest carrier, initially said it was keen, but pulled out after the government made it clear it wouldn’t only sell Air India’s international operations.

Bloomberg

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In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

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  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.