"There was a proposal of civil aviation ministry of disinvestment of Air India, this has been given theoretical approval or an in-principal approval," said Jaitley.
"In its proposal the civil aviation ministry had urged to constitute a group under the finance minister which can decide on the concerning modalities of the same, the cabinet has accepted that. How much of it will be disinvested? Or the issues related to its debts, hotels will be later on decided by the constituted group," he added.
This step comes in the view of Ministry of civil aviation plying ways to revive Air India, which is surviving on Rs 30,000 crore bailout package extended by the previous UPA regime.
Air India constitutes of the largest fleet of 140 planes in India. According to reports, the cabinet chose between two options suggested in a 30-page note prepared by the Department of Investment and Public Asset Management (DIPAM) after discussions in a Committee of Secretaries, headed by the cabinet secretary.