Government planning to sell 51% stake in debt-ridden Air India

India is planning to sell a majority stake in Air India to a strategic partner in a bid to turn around the loss-making airline.

Government planning to sell 51% stake in debt-ridden Air India

India is planning to sell a majority stake in Air India to a strategic partner in a bid to turn around the loss-making airline.

The proposal includes reviving Air India within five years of selling a 51% stake, people with knowledge of the matter told Bloomberg.

Talks are at an initial stage and presentations have been made to the finance ministry and the prime minister’s office, the reported added.

Intense competition private airlines has added to the woes of Air India, which is saddled with about $7 billion in debt and has been unprofitable since 2007.


Prime Minister Narendra Modi's administration will have to tackle the airline's debt to make Air India attractive to investors, according to Mark Martin, founder of Dubai-based Martin Consulting LLC.

"It's a welcome step but premature," said Martin. "The government should first set its house in order by amortizing and restructuring the debt before it tries to find someone who will buy 51 percent."

India's finance ministry wants the plan to be discussed in detail to avoid a situation where there are no buyers after the offer is announced, the Bloomberg report said.