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With Air India set to be acquired by Tata group, Prime Minister Narendra Modi today said that the decision on the national carrier will give new energy to India's aviation sector.
PM Modi's remarks come weeks after the Tata group emerged as the winning bidder for Air India paving the way for disinvestment of the debt-ridden, government-owned national carrier.
While addressing an event at the Kushinagar International airport, the prime minister said that the decision on Air India will give new energy to the aviation sector of the country.
Meanwhile, the International Monetary Fund on Monday said the sale of Air India will constitute an "important milestone" in India's privatisation efforts.
Tata group has emerged as the winning bidder for Air India, and on October 11, a letter of intent (LoI) was issued to the group.
Earlier this month, the Centre accepted an offer by Talace Pvt Ltd, a unit of Tata group, to pay ₹2,700 crore cash and takeover ₹15,300 crore of Air India's debt.
After Tatas accept the LoI, the share purchase agreement (SPA) for the sale will be signed. Along with Air India, Tatas will acquire low-cost carrier Air India Express and Air India's 50 per cent stake in equal joint venture AISATS.
As on August 31, Air India had a total debt of ₹61,562 crore. About 75 per cent of this debt or ₹46,262 crore will be transferred to a special purpose vehicle AIAHL before handing over the loss-making airline to the Tata Group.
Of the 141 Air India aircraft that Tatas would get, 42 are leased planes while the remaining 99 are owned. Tata will also take over the capitalised lease liability on account of operating leases of ₹9,185 crore.
Besides, some of these 141 planes are grounded due to lack of engine and other maintenance. Also the obsolescence factor is there are many as not fuel efficient.
With agency inputs
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