Senior Indian Administrative Service (IAS) officer Rajiv Bansal has been made the new CMD of Air India. He will take command at a critical time when the process of selling Air India has started.
The process of selling Air India is in progress. Meanwhile, its Chairman and Managing Director (CMD) Ashwani Lohani’s one-year term has ended. The government has replaced Rajiv Bansal, a senior Indian Administrative Service (IAS) officer, as the new CMD.
The Appointments Committee of the Cabinet approved the appointment of Bansal as the CMD of Air India. Bansal, a 1988 batch IAS officer of Nagaland cadre, was Additional Secretary in the Ministry of Petroleum and Natural Gas.
Command in Critical Phase
Bansal got the command of Air India at a time when the process of selling a 100 percent stake in it is going on. Recently, a tender has been invited for this, for which March 17 is the last date. The government has introduced a plan to sell a 100 percent stake in Air India. Despite all the opposition, the government is committed to selling Air India.
What is Sales Planning
According to the bid document issued by the government, a 100 percent stake of Air India Express will be sold. Apart from this, a 50% stake of AI will be sold in AISATS, a joint venture company of Air India and SATS. The management control of Air India will also be given to the winning company.
These Are Buyers
The government has released the deadline till March 17 to show the expression of interest (EoI) for Air India. News agency IANS quoted sources as saying that potential bidders for Air India include the Tata group, Hinduja, Indigo, SpiceJet and several private equity companies. Many foreign companies can partner with Indian companies to participate in the auction of Air India.
Ashwani Lohani was brought back to Air India in February 2019 with the view that he would transform into a sinking AI, but the effort was not successful. Even before this, Lohani was made the head of Air India from August 2015 to August 2017. He was also the Chairman of the Railway Board from August 2017 to December 2018.
Thousands of Crores of Debt on Air India
Air India has a debt of thousands of crores of rupees, including long-term loans for the purchase of aircraft and working capital. According to an official who is aware of the disinvestment plan, ‘Now Air India only has a loan of Rs 18,000 crore. When a bid is invited for this, then only a loan of Rs 18,000 crore will be shown in the accounts.
Explain that in FY 2018-19, Air India had a net loss of Rs 8,556 crore. On January 7, a group of ministers, headed by Home Minister Amit Shah, approved the proposal related to privatization.