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4) Examine the various levels of shareholding under Companies Act. Analyze whether public listing of Air India will address its woes?(250 words)

Topic – Indian Economy – Issues

4) Examine the various levels of shareholding under Companies Act. Analyze whether public listing of Air India will address its woes?(250 words)

Financial express

Reference

 

Why this question

Now that the idea of privatization of Air India has come a cropper, the focus has shifted to alternate solutions which will address the troubles plaguing the airlines. In this backdrop, the suggestion by NITI Ayog has to be analyzed in depth.

Key demand of the question

The question first focuses on the theory of various levels of shareholding such as 25%, 51% etc and the impact it has on shareholders rights. Thereafter, the suggestion that public listing of AI will address its issues needs to be analyzed in depth. The pros and cons of the move has to be brought out along with the way forward.

Directive word

Examine – When you are asked to examine, you have to probe deeper into the topic,  get into details, and find out the causes or implications if any .

Analyze – When asked to analyze, you  have to examine methodically the structure or nature of the topic by separating it into component parts and present them as a whole in a summary. When you are asked to analyze, you have to examine each part of the problem. It is a broader term than ‘Examine’.

Structure of the answer

Introduction – Mention that the recent attempt at privatization of AI saw no interested parties coming forward and thus, alternatives are being looked into.

Body – First bring out the various levels of shareholding under Companies Act and the impact it will have on shareholder’s rights.

Thereafter, explain the suggestion by NITI Ayog regarding public listing of AI. Highlight in brief the woes of AI that needs course correction. Analyze whether listing of AI which will grant autonomy to the board will help in improving the Balance Sheet of AI. Bring out the pros and cons

Conclusion – Present a fair and balanced view and the way forward.