The Air India plane flying the inaugural trip from Lucknow,
The Air India plane flying the inaugural trip from Lucknow, the capital of India's Uttar Pradesh, approaches to land at Najaf International Airport in the central Iraqi shrine city on February 14, 2019.HAIDAR HAMDANI/AFP/Getty Images

The disinvestment process of Air India has picked up pace again. The Finance Ministry along with the Aviation Ministry are now targeting October as the new deadline to announce the much-anticipated deal. The two ministries are known to have moved in full swing as the centre is now shortlisting the potential bidder, financial daily Business Standard reported. The Tata group is at the forefront of showing interest in buying a stake in Maharaja, which is reeling under a huge debt of Rs 59,000.

Moreover, the government is also exploring other businesses for strategic disinvestment in Air India. The proposed dialogue with potential buyers and the process of issuing bid documents for expression of interest is likely to happen simultaneously later this month. One of the sources privy to the development said, "Now that the finance minister has committed in the Budget, we will start approaching prospective bidders." Affirming on the fact that Tata will be government's first choice he further added, "They have a history with aviation and they know how to run an airline."

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Air India passenger planes are seen parked at the Chhatrapati Shivaji International airport in Mumbai, India, February 7, 2017.Reuters file

In her Budget speech, Finance Minister Nirmala Sitharaman reiterated that Air India disinvestment is on government's top list and said, "In view of the current macroeconomic parameters, the government would not only reinitiate the process of strategic disinvestment of Air India but would offer more central public sector enterprises for strategic participation by the private sector."

It is expected that the Air India Specific Alternative Mechanism (AISAM) is likely to be reconstituted by the government. The document of the new bid will be followed soon. AISAM is empowered to approve every step of Air India divestment process with Union Cabinet has the authority to give only blanket approval.

In NDA's last term, then Finance Minister Arun Jaitley, Road Transport Minister Nitin Gadkari, Commerce and Civil Aviation Minister Suresh Prabhu, and Rail Minister Piyush Goyal were the part of AISAM. The incumbent finance minister and civil aviation minister will be included in the AISAM soon. The government is planning to sell a 95 per cent stake of Air India and the rest 5 per cent is likely to be kept as the employee stock option.