IndiGo, the country's biggest airline by market share, has expressed interest in buying a stake in Air India a day after the cabinet approved a proposal to dilute state ownership in the debt-laden flag carrier, reported Economic Times.

"We have received an expression of interest for Air India from IndiGo," stated the report citing aviation secretary RN Choubey. "It has written to us that it is interested in Air India, as the government has decided to privatise it," he noted.

The civil aviation ministry has so far not received a formal expression of interest from any other entity, including the Tata Group, Choubey said. Junior aviation minister Jayant Sinha, however, added that several airlines have informally enquired about the privatisation of Air India, which has more than Rs50,000 crore of debt on its books.

It's been reported previously that the Tata Group could be a possible acquirer.

"A wide range of players — both international and domestic — have informally expressed interest in Air India. We would not like to name them as they have not yet made a formal application like IndiGo," Sinha said.

On Wednesday, the cabinet cleared the decks for the disinvestment of the loss-making flag carrier, and approved the creation of a panel led by FM Arun Jaitley to decide on the extent of ownership dilution and the best method of achieving that goal.

"The committee will have the aviation minister as a member and other ministers too will be added to the committee, if the prime minister decides," said aviation minister Ashok Gajapathi Raju.

"The committee will look at all possibilities for Air India and will take a final decision on it," the aviation minister said.

IndiGo declared it was "time for India to take back its fair share of international traffic" and create hubs within the country in the letter to the aviation ministry, saying that the carrier was interested in the overseas operations of the state carrier.

"Over time, India has allowed disproportionate access to the airlines of some of the city states in the Middle East and Southeast Asia," said the letter, signed by IndiGo president Aditya Ghosh and published on the web site of the Bombay Stock Exchange (BSE) late Thursday.

"The massive hubs that these airlines have built have significantly benefited at the expense of India… Kindly treat this letter as our expression of interest in acquiring the international airline operations of Air India and Air India Express," he stated.

Emirates, Etihad and Qatar Airways connect several destinations in India to those in Europe and beyond. IndiGo, however, did not restrict its interest to Air India's international business.

"Alternatively, we are equally interested in acquiring all of the airline operations of Air India and Air India Express (the airline's no-frills overseas carrier)," he added.