The beleaguered Maharajah, scrambling for cash infusions since the failed disinvestment attempt, may have just landed a lifeline. The buzz is that Qatar Airways, which has been eyeing the fastest-growing Indian aviation market for a while now, is showing interest in buying Air India.
"We would be interested in Air India if we had a strong partner. We need to have a very strong partner and we take the airline without the baggage," Qatar Airways group CEO Akbar Al Baker told the media in the capital recently. According to The Economic Times, he had clarified that that the national carrier's total debt of over Rs 48,000 crore wasn't the problem. "Look, it is not the debt that's the baggage. It is the other functions that Air India carries out such as ground handling, engineering and things like that are. We would be interested only in the airline," Baker added.
To remind you, while the government was keen to sell up to a 76% stake in the loss-making carrier, the preliminary information memorandum released in March made it clear that the deal would also include stakes in Air India's subsidiaries like Air India Express and Air India SATS airport services, a ground-handling service company formed in partnership with Singapore-based SATS. This condition eventually proved to be a deal breaker for most interested buyers.
According to Reuters, back in 2017, a year after India eased foreign investment rules for the sector, Qatar Airways had said it would set up a domestic airline in the country. But its plans haven't gained traction. "We are really very interested to launch an airline in India, but the regulation is a little bit confusing to us," said Baker. Qatar Airways planned to own a minority stake of the domestic airline with sovereign wealth fund Qatar Investment Authority (QIA) being the majority owner. However, according to him, enquiries to start the application process in India were rejected over QIA's ownership of the state-owned Gulf carrier.
In any case, Air India isn't the only option for Qatar Airways - it is reportedly also keen on a 15-25% stake in IndiGo. If both options fail to pan out, Baker said that they would have to forget about the domestic market.
The daily added that Qatar Airways is pushing for an increase in bilateral flying entitlements and has made fresh requests to the Indian government for the same. "Unfortunately, the civil aviation ministry has been unfair with Qatar Airways [in case of granting increase in bilateral rights]. While we were been restricted, everyone was getting bilaterals," said Baker. "First, there was a condition that Indian carriers need to utilise 80% of existing bilaterals. They have now reached 84%, still there is no light at the end of the tunnel."
Indeed, Dubai and Abu Dhabi have seen huge increase in their flying rights quota with India. However, the government is reportedly not keen to allow any new seats to countries within 5,000 km radius unless domestic airline companies fully support it.
With Reuters inputs