With bidding officially closed for stakes in Air-India and domestic carrier Indian Airlines, the contest has narrowed to three airlines and airline partnerships, two industrial groups and one union - the pilots.
And while the Indian government minister responsible for the high-profile privatisation let slip that the partnership of Singapore Airlines (SIA) and India's TATA Group had the inside track, it is far from clear who will end up with control.
At stake is 40% of the loss-making national carrier. Besides SIA-TATA, those in the race include Dubai's Emirates Airline; the SkyTeam alliance of Air France and Delta Airlines; a group of Indian companies led by London-based steel magnate L N Mittal; the British-based Hinduja Group; and the Air-India pilots' union. British Airways and Qantas are acting as technical advisors to Mittal's group. Most vocal among the Air-India bidders is the pilots' union whose members are against any foreign ownership. The pilots would redeploy staff in ancillary activities and embark on an aggressive fleet expansion.
Indian Divestment Minister, Arun Shourie, has been quoted as saying that SIA-TATA had the best credentials of the interested parties, and presented "a good local and foreign combination." However, the minister was at pains later to dismiss the report as a "misunderstanding," saying that while the pair make a strong team, "there is no way at all that I can say they are the best or better than others." He added that he was anxious not to pre-empt the bidding.
Industry observers have also tipped SIA for success as it is the only foreign contender with an Indian partner. SIA has been courting the Indian aviation industry for years, but was forced to withdraw an earlier project when the government changed, and with it the rules on foreign equity shares.
Source: Airline Business
