Modi Wants to Pump $330 Million Into Air India After a Failed Sale Bid

(Bloomberg) -- The government of Prime Minister Narendra Modi sought Parliament’s approval for an equity infusion of 23 billion rupees ($330 million) in Air India, effectively ruling out an immediate revival of its plan to sell the ailing carrier.

Modi’s bid to turn the airline profitable under his watch comes after the government failed to find any takers for its ambitious plan to privatize the national airline. Air India, which was offered along with $5 billion of its debt, is surviving on taxpayer bailouts after losing money for years.

The failed attempt to sell Air India -- Modi’s most high-profile privatization plan -- was a setback for prime minister’s effort to cement his credentials as a reformist steering the state away from running businesses ahead of an election due next year. The airline, which has $8 billion debt on its book, hasn’t made money in more than a decade.

The government has a four-part strategy for Air India -- a financial package, a branding refresh, organizational and governance reforms, and a plan to motivate staff, Jayant Sinha, junior aviation minister, said last week.

©2018 Bloomberg L.P.