Tata Group takes back control of Air India
Government pays back 8.2 billion dollars in losses, privatization after 70 years
After almost 70 years of State ownership, the national carrier Air India (and low-cost subsidiary Air India Express) is back under the control of the Indian conglomerate Tata. The privatization agreement, worth 2.4 billion dollars, was finalized in these days, according to schedule. It is a move that puts an end to a troubled sale process due to the airline's high debt, which lasted several years.
"The interest on the debt and other liabilities was very high, and it was decided to settle the debt now", said the Dipam chief. "Both excess debt and excess current liabilities, whatever was left with the government, have been written off". This was stated by the secretary of India's public investment department (Dipam), Tuhin Kanta Pandey, who oversaw the privatization process.
Air India, whose total losses climbed to 9.5 billion dollars, had been kept afloat using taxpayers' money. Prior to privatization, the government settled the remaining missing 8.2 billion dollars and other liabilities. On January 27, Tata chairman Natarajan Chandrasekaran met with India's prime minister, Narendra Modi, before the handover. The company's board of directors resigned, giving way to a new board appointed by the industrial group.
AVIONEWS - World Aeronautical Press Agency