DELHI: The divestment of Air India is set to go through in the next financial year with Finance Minister Arun Jaitley’s 2018-19 Budget presented today staying on course with the airline’s disinvestment but that could be the only big ticket privatization of a public sector company in the next financial year.
C Garg, the secretary of the department of economic affairs, told CNBC TV18 that some companies were being discussed for privatization but none had been shortlisted. He also said barring Air India, no other large company would be sold off.
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The government plans to shed at least 51 per cent stake in the loss-making airline. An overseas investor including a foreign airline will be allowed to hold not more than 49 percent of the company’s equity. Minister of State for Civil Aviation Jayant Sinha had told Moneycontrol in a Jan 11 interview that the government was open to keeping a minority stake in the airline.
The carrier has planned a 2018-19 capital expenditure of Rs 1,156 crores which will get a help of Rs 650 crores in the form of equity support from the government. The capital expenditure for the next financial year is substantially lower from the Rs 6,430 crores it will spend in 2017-18. The equity support will also be much lower which will come at Rs 1,800 crores in the ongoing financial year.
He said the disinvestment would not take more than six to eight months with the legal closing and transfer of assets taking another few months. Sinha subsequently told Bloomberg that the government planned to split the company into four parts and would sell at least 51 percent in each of them.