(Bloomberg) -- India is open to listing shares of its flag carrier, an official said, as Prime Minister Narendra Modi’s administration struggles to find ways to dispose of the state asset after a botched plan earlier.
By selling shares in an initial public offering, the state can retain control of Air India Ltd. and also raise cash to fund its operations, a senior government official told reporters in New Delhi, asking not be identified citing rules. A group of ministers formed by the Ministry of Finance is considering other options as well, but is not in favor of giving control to a foreign entity, the official said.
Modi’s most high-profile asset sale didn’t see a single interested bidder by the time a deadline expired on May 31, dealing a blow to his reformist image ahead of a general election due next year. Air India, with $8 billion in debt and surviving on a taxpayer-funded bailout, hasn’t made money since its 2007 merger with another state-run domestic operator Indian Airlines.
Following the debacle last month, the government is planning to revive the process with new guidelines, including re-examining a clause requiring a minority state stake, Subhash Chandra Garg, a senior official in the Ministry of Finance, said in an interview on Monday. Previous attempts by the Indian government to dispose of the carrier were derailed by political opposition.
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