Privatisation The Air India A ‘well Thought-out’ Decision: Economic Survey


The Economic Survey has pitched for a committed action plan on “privatisation and disinvestment of Air India to enhance its operational and management efficiency,” terming the government’s announcement to privatise the national carrier as a “well thought-out” decision.

It is a major carrier of international traffic to and from India, accounting for 11.4 per cent of the total international travel, it added. In June, the Cabinet Committee on Economic Affairs (CCEA) gave its in-principle approval to the strategic divestment of Air India and its five subsidiaries.

A group of ministers, headed by finance minister Arun Jaitley, is working on the modalities of the proposed divestment.

The airline is surviving on taxpayers’ money. The turnaround plan, approved by the previous UPA government in 2012, provides for equity infusion of Rs 30,231 crore up to 2021, subject to the national carrier achieving certain milestones.

As part of the plan, various steps have been taken to cut costs and losses. These include route rationalisation and enhanced utilisation of new fleet.

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