After more than two decades and three attempts, the government has finally sold its flagship national carrier Air India, and it is deja vu for Maharaja as it returned home to its founding father the Tata group.

Jehangir Ratanji Dadabhoy (JRD) Tata founded the airline in 1932 and named it Tata Airlines. In 1946, the aviation division of Tata Sons was listed as Air India, and in 1948, the Air India International was launched with flights to Europe.

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The international service was among the first public-private partnerships in India, with the government holding 49 per cent, the Tatas keeping 25 per cent and the public owning the rest.

In 1953, Air India was nationalised and for the next over four decades it remained the prized possession for India controlling the majority of the domestic airspace.

With the opening up of the aviation sector to private players in 1994-95 and private entities offering cheaper tickets, Air India gradually started losing market share.

As part of its broader privatisation and disinvestment push, in 2000-01 the NDA government under Atal Bihari Vajpayee tried to sell a minority stake or 40 per cent stake in Air India.

Singapore Airlines along with the Tata group showed interest in buying the stake, but eventually Singapore Airlines pulled out mainly due to opposition to privatisation by trade unions. Hence, derailing the disinvestment plan.

The subsequent 10 years of Congress-led UPA governments from 2004-14 did not pursue any privatisation agenda including that of Air India. A Turnaround Plan (TAP) as well as a Financial Restructuring Plan (FRP) were approved for Air India by the previous UPA regime in 2012. Air India started suffering losses every year since its merger with Indian Airlines in 2007-08.

Cut to 2017: The Narendra Modi-led NDA Government had been putting its weight behind privatisation of CPSEs since it came to power in 2014. Here is a chronology of Air India privatisation plan:

June 2017: The Cabinet Committee on Economic Affairs (CCEA) gave in-principle approval to the consideration for strategic disinvestment of Air India and its five subsidiaries. A Panel of Ministers or Air India Specific Alternate Mechanism (AISAM) was constituted for this purpose.

March 2018: Government invites EoI from investors for buying 76 per cent stake in Air India, remaining 26 per cent to be with the government. The deal would also include 100 per cent in Air India Express and 50 per cent in ground handling arm AISATS. Last date to bid was May 14.

The buyer was required to take Rs 33,392 crore or close to 70 per cent of the beleaguered carrier’s debt on its books.

May 2018: No bids received for Air India.

June 2018: Government decides to go slow on Air India sale till oil prices soften.

January 2020: Government floats EoI for Air India privatisation. Government to fully exit Air India by selling 100 per cent. The deal would also include 100 per cent in Air India Express and 50 per cent in ground handling arm AISATS. Last date to bid extended 5 times until December 14.

As per the EoI, of the airline’s total debt of Rs 60,074 crore as of March 31, 2019, the buyer would be required to absorb Rs 23,286.5 crore.

October 2020: Government sweetens deal; gives flexibility to investors to decide on the amount of Air India debt they want to absorb.

December 2020: DIPAM Secretary said Air India EOI received “multiple bids”.
March 2021: Hardeep Singh Puri, the then Civil Aviation Minister said: “…There is no choice, we either privatise or we close the airline. We run a loss of Rs 20 crore every day despite Air India making money now.”

April 2021: Government starts inviting financial bids for Air India. September 15 last date to put in bids.

September 2021: Income Tax department allows new owners of Air India to carry forward losses and set it off against future profits.

September 2021: Tata Group, Spicejet Promoter Ajay Singh put in financial bids.

October 2021: Government announces Tata group makes winning bid of Rs 18,000 crore for Air India.