Air India to the Tata Group
January 27 has been set as the date to complete the handover of Air India to the Tata Group, a delay from the earlier deadline of December-end. Following delays in finalizing the balance sheet of the airline and procuring the necessary approvals from global regulators, the targeted timeline for the closure of the agreement was extended till January end.
What steps now stay in the transfer of the airline to Tatas
- According to Air India officials, the airline will share its balance sheet with the Tata Group on Monday for its review, which is expected to be concluded by Wednesday. Following this, on Thursday (January 27), the handover is possible to take place. The final date of the balance sheet has been set at January 20.
On October 11, the Centre had issued the Letter of Intent (LoI) to the Tata Group confirming its willingness to transfer a 100% stake in the airline to the Mumbai-based conglomerate. At the period, the expected timeline for transfer was arranged for the end of December. On account of various pending approvals, this date was extended to end-January.
Why is there a delay in finalizing the balance sheet?
The final balance sheet is being organized with the approvals from the various regulators, lenders, and lessors of the airline. This balance sheet will be provided to the Tata Group and is expected to account for the Rs 20 crore loss being incurred by Air India daily, till the cutoff date. Additionally, reported Sunday, citing an RTI answer, that various government departments and ministries had pending payments amounting to Rs 278.49 crore to Air India till October last year.
700 government departments
This also includes dues from the Prime Minister’s flights of Rs 7.20 crore and the President’s flight dues of Rs 6.14 crore. The airline has already started recovering the pending dues from the various government departments and as of November 30, 2021, Rs 30.38 crore has been rescued by the airline.
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Has the government taken any step to ensure such dues don’t grow?
The Department of Expenditure, Ministry of Finance, in an office memorandum dated October 27, 2021, had directed all ministries and departments to clear Air India’s dues instantly, in addition to asking these departments to buy air tickets from Air India only in money.