Air-India divestment seen over in 10 months

The adviser will be a consortium of financial institutions, merchant bankers and aviation sector experts. Civil Aviation Minister Sharad Yadav said the sell-off would give a boost to the airline. "After the adviser submits its report, the government will float bids inviting tenders for the strategic partner or partners," Yadav said.

Baijal said the management structure of the airline would be finalised before bids were invited. "But it is clear that the responsibility of the day-to-day operations of the airline will lie with the strategic partner."

Air-India, which lost 1.74 billion Indian Rupees ($39.15million) in the fiscal year to March 1999, had an estimated loss of 897 million Rupees in 1999/2000.

Air-India has more than 18,000 employees, and, at 750 workers per aircraft, has one of the highest employee-to-aircraft ratios in the world.

Asked if any foreign airline company had expressed interest in buying a stake in the airline, Baijal said: "All the time we are trying to keep the process totally transparent."

"We, after consultation with the global adviser, will try and build a structure which is biddable. I am 100 per cent sure many people will be interested," he added.

Asked if the government would further reduce its stake below 40 per cent in the future, Baijal said: "No decision has been taken but the decision is that we will prepare a road map for further disinvestment."

Baijal declined to comment when asked if the government was hopeful of achieving its disinvestment target of Rs 100 billion in 2000/2001 (April-March).