After IndiGo, which is the largest airline in India pulled out of the race to acquire Air India, now it’s time to Jet Airways to withdraw from the bid, which it did on Tuesday, which was a major shock and a blow to the government privatization plans. The government has no one coming up to bid as a frontrunner for the debt-laden Air India
Jet Airways’ deputy chief executive, Amit Agarwal said in a statement emailed to AFP “We welcome the government moves to privatize Air India. It is a bold step,”
“However, considering the terms of offer in the information memorandum and based on our review, we are not participating in the process,” he added.
At a time Air India was India’s monopoly Airline but with new private carriers coming in with more competitive fares and better facilities, Air India has slowly but steadily lost out on the Indian flyers market base.
Since 1997 to 2007 Air India ran losses for almost a decade before a merger in 2007 and has cumulative debts of around $7.67 according to government statistics
Air India has received a big boost in the form of a bailout which comes to around$5.8 billion, but it still needs more working capital to turn the tables around.
Recently the Government announced that they wanted to sell 76 percent share of the debt-ridden struggling air carrier. In what would be one of the country’s highest-profile asset sales in years, Government is giving strong signals that it wants to wash its hands of all of Air India’s operations as soon as possible.
The country’s largest and most profit making airline, IndiGo withdrew its bid on Friday stating that it was only interested in Air India’s international routes and not its domestic operations.
India is soon becoming one of the largest markets of flyers and about 100 million Indians took to the skies in 2016. Airlines are also in the process of purchasing new jets with advanced technologies in the expectation of double-figure growth.
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