Finance Ministry asked all ministries to clear Air India dues. In an office memorandum, the central government officials have been asked to buy Air India tickets in cash till further notice. The order was disseminated after Air India ended its credit facility to the government following its disinvestment.
The Ministry said that the government recently decided to disinvest Air India. The disinvestment process of Air India and Air India Express is ongoing. In a letter to all ministries and departments under the Government of India referred to an earlier office memorandum where officials were asked to travel only with Air India if the cost is borne by the Centre. This included leave travel concessions (LTC).
It further said, “Air India has stopped extending credit facility on account of purchase of air tickets. Therefore, all ministries/departments are directed to clear Air India’s dues immediately.” Air tickets from the airline may be purchased in cash till further instructions, it added.
The Finance Ministry noted that ministries and departments should bring these developments to the notice of their subordinate offices, institutes, etc. that are under their administrative control, for compliance.
It is worth adding that the government on Monday signed the share purchase agreement with Tata Sons for the sale of Air India for Rs 18,000 crore. Earlier this month, the government had accepted an offer by Talace Pvt Ltd, a unit of the holding company of the salt-to-software conglomerate, to pay Rs 2,700 crore cash and take over Rs 15,300 crore of the airline’s debt.
Following that, on October 11 a Letter of Intenet (LoI) was issued to the Tata Group confirming the government’s willingness to sell its 100 per cent stake in the airline. “Share Purchase Agreement signed today by Government with Tata Sons for strategic disinvestment of Air India,” Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey tweeted.
Now, various regulatory clearances, including from the Competition Commission of India (CCI), would have to be taken by Tata Sons before the actual handover of the airline takes place by December-end. The government is divesting its 100 per cent ownership of Air India and Air India Express along with its 50 per cent stake in ground-handling company AISATS.
