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Why companies like Air India Bharat Petroleum are not able to sell even if they want?
India

Why companies like Air India, Bharat Petroleum are not able to sell even if they want?

Read Time:3 Minute, 10 Second

Air India is one of the few main public sector units (PSUs) that the government has been trying to sell since 2001. The government has not been able to find even a single buyer to sell this government airline.

Air India is currently in a significant amount of debt. All the liabilities of Air India were above 70,686.6 crores in the year 2018-19.

Even after the merger with domestic flight company Indian Airlines in 2007, the company is running at a loss.

In 2018, the government brought the airline to resell it, but this time also it did not get success in it because the government wanted to retain its 24 percent stake. For this reason, many investors did not show interest in buying it.

Finally, in January 2020, the government announced that it was ready to sell the entire stake of this international airline, burdened with heavy debt.

Air India, Bharat Petroleum Tata is Interested in Buying

According to recent media reports, the government has shown interest in buying it from several buyers, who will be asked to send the proposal after which the auction process will begin.

According to media reports, only two parties are interested in buying it. The first is to buy it from Tata Sons and secondly Air India employees and American investment company Interps together.

However, experts believe that Air India will not be able to get a buyer till the end of this financial year i.e. March.

Col. Sanjay Julka, Chief Executive (Technical), Club One Air, which serves the charter flight, told the BBC, “It is clear that the UPA and NDA governments have had flaws in the conditions they brought about disinvestment. But he has not listened to the future bidders. Because of this, the process of disinvestment of this company has gone so long that it could have been done properly in the past. “

Air India, Bharat Petroleum Kapil Kaul, CEO of Center for Asia Pacific Aviation, an aviation consultant for South Asia, expects a successful bidder to be announced by June and a private ownership transfer by December.

Kapil Kaul tells the BBC, “They are strategically determined and I think they will be able to sell it this time. They have taken care of many loans and they have also accepted that the bid is the enterprise value. Will be on

India’s Failed Disinvestment Strategy?

It is not only Air India whose government has to work so hard to find a buyer, but India’s disinvestment plan has been like a flop show. In the last 12 years, the government has been able to meet its disinvestment target only twice.

Disinvestment is a process in which the government increases its funds by selling assets of public sector units (PSUs) under its control. Governments do this to reduce the difference between their expenditure and income.

In the last financial year 2019-20, the government missed Rs 14,700 crore in meeting its target while the target was to raise Rs 1.05 lakh crore that year.

One analyst says on condition of anonymity, “Most PSUs have poor management and have very high government intervention. Investors who are also keen on investing in it find it difficult. They find these units Will sell out. “

The financial year 2020-21 ends on 31 March and the government has set a target of Rs 2.1 lakh crore for this year, out of which it has been able to raise only Rs 28,298.26 crore.

According to data from the Department of Investment and Public Asset Management, the government has so far divested its stake in Hindustan Aeronautics, Bharat Dynamics, Mazgaon Dock Shipbuilders, and IRCTC.

Also read: CG Police Constable DEF PET Admit Card 2021 Admit card released, download from this direct link

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Rajveer Sekhawat

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