A planned sell-off of loss-making Air India has been put on ice after the government failed to attract any buyers.

India’s government approved plans to privatise the debt-laden carrier last year with an ambition to sell 76% of the carrier.

The Indian government will now provide funds for its day-to-day operations and aircraft orders.

A government official was quoted in local media as saying: “The airline is posting operational profits. None of the flights go empty.

“With all the cost efficient mechanism in place, we will continue improving its operational efficiency. There is no need to rush in for disinvestment as of now.”

Vistara – a joint venture airline run between India’s Tata Group and Singapore Airlines – or India’s biggest airline IndiGo had been tipped as potential bidders.

But analysts said the lack of interest in the sale was a reflection of the level of debt owed by Air India together with the fact that it had not turned a profit since 2007, the BBC reported.