New Delhi defends Air India sale conditions

New Delhi has defended the conditions of its failed bid to sell a 76% stake in Air India. Minister of state for civil aviation Jayant Sinha says that the conditions "were balanced" but that "market conditions and industry dynamics were such that people were not enthused by what was on sale". Sinha said: "If you look at what has been happening in the airline industry over the past six months to a year, with oil prices going up, interest rates going up, currency fluctuations, profitability has been hit very hard - particularly for the full-service carriers. This proposition (Air India sale) may have been a tall order." Observers have said that the major obstacles include the requirement for the new owners to take on half carrier's US$7.47b debt, plus current liabilities, as well as the govt's 24% stake meant significant involvement from New Delhi. <br/>