New Delhi: Immediately after the proposed privatization, the Indian government has asked Air India to freeze large-scale promotions and appointments.
The new flight will begin only if it is very necessary and after due diligence from the commercial aspect.
"His direction came almost a week ago. It was said that due to impending privatization, no major initiatives should be taken. There will be a freeze on promises and promotions," an official source told IANS.
Directives issued by the Department of Investment and Public Asset Management or DIPAM.
After failing to find bidders in the previous period, Modi 2.0 government worked on a war footing to sell Air India to private players. This has reshaped the ministerial group (GoM) to break the path of privatization.
EY consulting company is working to complete the initial information memorandum (PIM) to invite expressions of interest (EoI) from prospective bidders.
"This time, we have no doubt about the release of investment. The speed at which things move, airline ownership will be transferred to the private sector," said a senior Air India executive.
Air India has a total debt of around Rs 58,000 crore. The cumulative loss from national operators is Rs 70,000 crore. In the financial year ended March 31, 2019 the airline is estimated to have reported a loss of Rs 7,600 crore.
Civil Aviation Minister Hardeep Singh Puri this week said that Air India must be privatized to save him. He suggested that the government is not equipped to run an airline where daily operational decisions must be taken immediately rather than following the bureaucratic process or going for the tender process.
"It is up to me, I will all be fully interested in supporting the public sector. However, the question arises: is the government equipped to run an entity, such as Air India, where daily operational decisions must be made on the spot?" Puri said in Rajya Sabha.
The reshaped Go government led by Interior Minister Amit Shah is expected to meet in the next few weeks to make a decision regarding the privatization of Air India.