A ministerial panel led by home minister Amit Shah has approved the draft of expression of interest and share purchase agreement for selling the government's stake in Air India and will invite preliminary bids in January, sources close to the development told CNBC-TV18.

"Everything related to Air India divestment, including the debt part and other details, has been approved at the ministerial panel. Now, EoI will come out," a source said.

The government plans to sell its entire stake in the second attempt at the airline's disinvestment. In the first attempt, which concluded last year, the government had failed to receive a single bid for 74 percent stake in Air India.

Air India is the largest international carrier and the third largest domestic carrier after IndiGo and SpiceJet. As of November 2019, it had a 12.1 percent share in the domestic air passenger traffic. Saddled with a debt of around Rs 60,000 crore, the airline has been making losses to the tune of Rs 20-25 crore every day.

While no party has officially come forward till now to show interest in Air India other than IndiGo, the government maintains that several entities have found the airline lucrative.

IndiGo, India's largest airline, has maintained that it is interested in the international segment of the carrier.

The government does not want to leave any stone unturned to make the second attempt at the Air India divestment successful as it is planning to offload a substantial amount of debt from Air India's balance sheet.

CNBC-TV18 had reported in November that the government was planning to waive off the airline's payables to oil companies, airports and other vendors amounting to around Rs 22,000 crore.

This is over and above the airline's total debt at nearly Rs 60,000 crore. As per provisional figures for 2018-19 (Apr-Mar), the total debt of the national carrier stood at Rs 58,351.93 crore.

"We are planning to sell Air India largely with the loans against the assets. Aircraft and slots are the two main assets for the airline and we are confident that this will be a lucrative offer for any bidder," one of the sources had told CNBC-TV18.

While the airline's total debt and payables to vendors etc amount to over Rs 80,000 crore, the government has already decided to transfer Rs 29,464 crore to a special purpose vehicle called Air India Asset Holding Company.

First Published:Jan 7, 2020 12:45 PM IST