NEW DELHI: Emphasising that the Air India transaction is a "win-win situation" across the board, Union Civil Aviation Minister Jyotiraditya Scindia on Tuesday said taxpayers' money will now be more justifiably used for many more socially productive purposes rather than filling the deep losses of the airline.
He also said the disinvestment will provide an opportunity for the airline to rise as a phoenix again.
In October, Talace Pvt Ltd, part of the Tata group, emerged as the winning bidder for Air India with a bid worth Rs 18,000 crore.
It will pay Rs 2,700 crore cash and take over Rs 15,300 crore of the airline's debt.
"Shareholders agreement was signed in November. Today, we are in the process of closing all the conditions precedent and I am very confident at the turn of the New Year, you will have the transfer of Air India to its new owner....," he said.
Scindia was speaking at a session on 'Building India into a Global Civil Aviation Powerhouse' of Partnership Summit 2021, organised by industry body CII in association with the Department for Promotion of Industry and Internal Trade (DPIIT).
From a company perspective, Scindia said, here is the opportunity for Air India to rise as a phoenix again.
"From a customer-centric point of view, you have got a new company that has come in, which already has a full-service airline and a budget airline and taking over Air India plus Air India Express. The four companies together have the capability of presenting themselves as a very unique proposition....A win-win situation across the board," he said.
Noting that the government has gone through a very clear iterative process for the disinvestment, Scindia said Air India was pretty much driven into the ground due to many unfounded decisions that were taken earlier and added that he does not want to go back to history.
The navratna company is laden with close to Rs 52,000 crore debt infusion, another Rs 54,000 crore of government guarantees that makes the total liabilities of Rs 1,04,000 crore, he pointed out.
"Prior to that, an equity infusion of Rs 36,000 crore by the government and a current debt portfolio of as we speak of about Rs 62,000 crore. All in all, you are talking about Rs 2 lakh crore bill for the singular purpose of being able to run an airline."
"I believe that if you look at it from every stakeholders' point of view, this has been a win-win transaction....taxpayers' money, which I think is more justifiably used for many more socially productive purposes rather than filling the deep losses of a state-run airline.," Scindia said.
The minister also said that a supportive drone policy is in place that is based on trust.