Govt may defer Air India sale, reduce debt to sweeten the deal

The government may defer the planned sale of Air India by up to three years until the turbulence caused in the aviation industry by the Covid-19 pandemic eases, two persons aware of the development said. Another option under consideration is sweetening the deal by reducing the Air India debt liability that a prospective buyer of the airline would assume.

Experts engaged in the process of divesting Air India have pointed to the lukewarm response by investors to the existing offer on the table and suggested that the government consider extending the October 30 deadline for submission of bids,reduce the debt liability of Rs 23,286 crore or allow bidders to place a value on the government’s equity stake and say how much how much debt they would assume, the two persons said on condition of anonymity.