Civil Aviation Ministry will shortly take the view of the Union Cabinet on divestment of Air India and Indian Airlines before it proceeds with the proposal for fleet acquisition of the two carriers.
"We will shortly take a note to the Cabinet to seek its views on divestment of the two airlines and then accordingly proceed with aircraft acquisition," Civil Aviation Minister Shahnawaz Hussain told reporters on Wednesday after inspecting the arrangements for Haj pilgrims at the Delhi airport.
He said the Cabinet would "first guide us on divestment and only then will we think of putting money" to finance aircraft acquisition.
Hussain said the entire process would be over "very soon".
The Cabinet Committee on Security had last night deferred by a month a decision on the issue of acquisition of 43 aircraft by Indian Airlines and 17 by Air India.
The ministry had earlier sent a "factual note" to the CCS on the matter and was eager to expedite the process, official sources said.
They said the CCS had the option of either formulating a new procedure for acquisition or allow the normal procedures to be followed.
Indian Airlines Board has recommended acquisition of 43 planes from the European aircraft manufacturer, Airbus
Industrie, at a cost of over Rs 10,000 crore (Rs 100 billion). The fleet suggested for acquisition is a mix of A-319s, A-320s and A-321s and they are to be delivered over four years between 2004 and 2008.
Air India board on November 29 gave its nod for the acquisition of 17 250-seater aircraft over the next five years as part of its fleet expansion plans to meet growing capacity requirements. It had decided to acquire a combination of Airbus A 340-300 and Boeing B 737-200 ER (extended range).