NRIs allowed to acquire stakes in Air India

The government has permitted non-resident Indians (NRIs) to acquire stakes in Air India. To this end, the government approved 72 changes to the Companies Act, paving the way for direct overseas listing and decriminalising a host of offences under the act. Under the extant rules, NRIs can acquire only 49 per cent in the national carrier. The announcement comes at a time when the government is looking to sell its 100 per cent stake in the airline. Currently, Air India serves 98 destinations, including 42 spots overseas. It has 121 aircraft of which it owns 32 while the rest are leased. For interested investors, the last day of submitting expressions of interest was March 17, 2020, and qualified bidders will be notified on March 31, 2020. Reportedly, Indian conglomerates such as the Tata Group, the Adani Group, IndiGo, Vistara and New York-based fund Interups are interested in acquiring a stake in the financially stressed airline. Meanwhile, the national airline plans to raise up to Rs 7 billion through a short-term loan from domestic lenders. The loan will carry a sovereign guarantee. The proceeds are planned to be utilised to meet the working capital requirements of the carrier as well as repay a portion of its dues to its vendors, including oil marketing companies.