To smoothen the divestment of Air India on Monday the Ministry of Finance issued a Gazette notification amending the Foreign Exchange Management (non-debt instruments) Rules, 2019. One of the major changes regarding the Air India disinvestment is concerning the OCI cardholders who earlier could and cannot invest 100 percent in Air India now. After the Gazette was released Vinamra Longani, head of operations, Saril & Company a law firm specializing in aircraft leasing and finance said that now NRIs can invest 100 percent in the flag carrier, as per the amendment he also said that the Reserve Bank of India has been vested with the sole power to issue the rules in this regard. Previously the consultation with the Central Government was required. Non-resident Indians who are Indian Nationals in Air India through the automatic rote. The cabinet approved a policy to permit its investment up to 100 percent. Hardeep Puri the Minister of Civil Aviation on July 16 said that the divestment of Air India was still on the cards. Privatization leaves us with no option for the simple reason that the Air Lines where under strain in the pre-COVID time and the pandemic introduced a new element. In the current situation even if Air India wants to be dependent on the government may not be in a position given other demands being made on it.
For sale government put its entire stake in Air India. So NRIs could own 49 percent in the Air Line. As the COVID-19 fall out disrupted economic activity globally the Centre in June extended the deadline to bid for Air India by two months till August 31. In January 2020 the government restarted the divestment process and invited bids to sell 100 percent equity in the state-owned Air Line, including Air India’s 100 percent shareholding AI Express Limited and 50 percent stake in Air India SATS Airport Service Private Limited after its successful bid to sell Air India in 2018. In January, while issuing the Expression of Interest (EOL) the last date for bids was kept on March 17, which was later extended till April 30 which was further extended to June 30 and subsequently till August 31. The government offered to sell 76 percent in the Air Line in2018, but the lockdown and widespread COVID -19 pandemic have disrupted economic activities globally. The Air Lines canceled flights and announced pay cuts for employees as an impact of coronavirus pandemic in the Aviation sector.
