"Air India faces privatization or shutdown utlimatum"

" \n As the Air India sale process continues, Civil Aviation Minister Hardeep Singh Puri has made the options clear: privatize or shutdown. \n \n\n \n Speaking to Parliament, he made it clear that Air India\u2019s high debt makes the airline unsustainable to run by the government. Let\u2019s find out more about the sale process and when Air India will be in private hands. \n \n\n \n <a href=\"http:\/\/www.pinterest.com\/pin\/create\/bookmarklet\/?url=https%3A%2F%2Fsimpleflying.com%2Fair-india-privatization-shutdown%2F&media=data%3Aimage%2Fsvg%2Bxml%2C%253Csvg%2520xmlns%3D%27http%3A%2F%2Fwww.w3.org%2F2000%2Fsvg%27%2520viewBox%3D%270%25200%25201000%2520667%27%253E%253C%2Fsvg%253E&description=Air%20India%20is%20currently%20losing%20%242.7%20million%20every%20day%20despite%20key%20changes%20at%20the%20carrier.%20Photo%3A%20Vincenzo%20Pace%20%7C%20Simple%20Flying&is_video=false\" target=\"_blank\" rel=\"noreferrer noopener\"> Air India is currently losing $2.7 million every day despite key changes at the carrier. Photo: Vincenzo Pace | Simple Flying \n \n\n \n Ultimatum \n \n\n \n In remarks before the Parliament, seen in\u00a0News18, Civil Aviation Minister Hardeep Singh Puri updated MPs about the status of the Air India sale. He made it clear that privatization is the only option for the airline and failure to do so would see Air India shut down completely. \n \n\n \n This is because of the flag carrier\u2019s massive debt, which currently sits at \u20b960,000 crores ($8.28 billion). \n \n\n \n He added that while Air India is a \u201cfirst-rate asset,\u201d the debt simply makes the carrier\u00a0unsustainable\u00a0to run. Explaining the airline\u2019s current financial state as well, Mr. Puri made it clear that \u201cwe need to draw the slate clean\u201d. \n \n\n \n <a href=\"http:\/\/www.pinterest.com\/pin\/create\/bookmarklet\/?url=https%3A%2F%2Fsimpleflying.com%2Fair-india-privatization-shutdown%2F&media=data%3Aimage%2Fsvg%2Bxml%2C%253Csvg%2520xmlns%3D%27http%3A%2F%2Fwww.w3.org%2F2000%2Fsvg%27%2520viewBox%3D%270%25200%25201000%2520667%27%253E%253C%2Fsvg%253E&description=While%20it%20might%20be%20a%20strong%20asset%2C%20the%20historical%20debt%20means%20the%20government%20must%20sell%20the%20airline%20soon.%20Photo%3A%20Getty%20Images&is_video=false\" target=\"_blank\" rel=\"noreferrer noopener\"> While it might be a strong asset, the historical debt means the government must sell the airline soon. Photo: Getty Images \n \n\n \n Currently, Air India\u2019s daily cash burn stands at \u20b920 crores ($2.76 million). While this is lower than many other major carriers, it comes even as Air India is now making money, according to Mr. Puri. This means the debt has made the airline unsustainable to fly even while it is making money. So when will we see the carrier to go private hands? \n \n\n \n Timeline \n \n\n \n Last week, the government\u00a0finalized the shortlist of bidders\u00a0for Air India, with the race down to the Tata Group and SpiceJet MD Ajay Singh. The two bidders will now have roughly two months (64 days) to analyze internal data and place their financial offers for Air India. \n \n\n \n The government hopes to complete the entire divestment process by May or June of this year. This is certainly an optimistic timeline considering the\u00a0delays\u00a0seen in the past, but Mr. Puri has made it clear that the government does not want to hold on to Air India for much longer. \n \n\n \n <a href=\"http:\/\/www.pinterest.com\/pin\/create\/bookmarklet\/?url=https%3A%2F%2Fsimpleflying.com%2Fair-india-privatization-shutdown%2F&media=data%3Aimage%2Fsvg%2Bxml%2C%253Csvg%2520xmlns%3D%27http%3A%2F%2Fwww.w3.org%2F2000%2Fsvg%27%2520viewBox%3D%270%25200%25201000%2520667%27%253E%253C%2Fsvg%253E&description=The%20new%20owners%20could%20take%20over%20Air%20India%20during%20the%20lucrative%20summer%20season%2C%20although%20there%20will%20be%20much%20work%20to%20do%20at%20the%20airline%20first.%20Photo%3A%20Pranjal%20Pande%20%7C%20Simple%20Flying&is_video=false\" target=\"_blank\" rel=\"noreferrer noopener\"> The new owners could take over Air India during the lucrative summer season, although there will be much work to do at the airline first. Photo: Pranjal Pande | Simple Flying \n \n\n \n The coming month will tell us more about if the government can stick to this timeline. For now, both Tata and Ajay Singh are likely poring over Air India\u2019s internal data to plan their final bids. \n \n\n \n Out the door \n \n\n \n Explaining why this privatization would be different from previous ones, Mr. Puri said that the government is determined to sell the airline and other attempts had been half-hearted. \n \n\n \n <a href=\"http:\/\/www.pinterest.com\/pin\/create\/bookmarklet\/?url=https%3A%2F%2Fsimpleflying.com%2Fair-india-privatization-shutdown%2F&media=data%3Aimage%2Fsvg%2Bxml%2C%253Csvg%2520xmlns%3D%27http%3A%2F%2Fwww.w3.org%2F2000%2Fsvg%27%2520viewBox%3D%270%25200%25201000%2520667%27%253E%253C%2Fsvg%253E&description=After%20a%20decade%20of%20headaches%20and%20losses%2C%20leaders%20are%20finally%20ready%20to%20let%20go%20of%20the%20airline.%20Photo%3A%20Vincenzo%20Pace%20%7C%20Simple%20Flying&is_video=false\" target=\"_blank\" rel=\"noreferrer noopener\"> After a decade of headaches and losses, leaders are finally ready to let go of the airline. Photo: Vincenzo Pace | Simple Flying \n \n\n \n Indeed, the sale will also see the government receive a cash surplus, with at least\u00a015% of the debt\u00a0being paid upfront by the new owner. Moreover, the sale will mean one less loss-making enterprise for the government to manage during this crisis. \n \n\n \n \n \n\n \n www.simpleflying.com \n "

"Air India faces privatization or shutdown utlimatum"

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