Asked for a timeline for setting up of the ministerial group, Jaitley said: "In this government, the groups are set up very fast..."
The aviation ministry has also expressed concerns over privatisation proposals stating the plan for revival of Air India would be taken up by the cabinet only after various issues, including the concerns raised by the parent ministry, are resolved.
Unions representing Air India's employees have been the fiercest opponents to the sale, with one demanding the government waive debts instead of offloading the airline to a private buyer.
The airline, which was afloat thanks to a Rs 30,231 crore nine-year bailout programme approved in 2012, has about Rs 52,000 crore of debt.
The group on Air India-specific Alternative Mechanism headed by the finance minister will include Civil Aviation Minister and other concerned ministers. Earlier also, the Tatas had tried to acquire stake in Air India. The government has accepted the NITI Aayog suggestions on privatisation of Air India, he said. "In this country, if 87 or 86 percent flying can be handled by the private sector. then they can also do 100 percent", Jaitley said.
"Air India's balance sheet has to be restructured and debt reduced". "Every year's delay has only cost taxpayers money and eroded Air India's market value".
The government had ordered the loss-making airline to turn around its fortunes, prompting the carrier to slash employee overtime and other expenses.
The top contenders for the ownership of debt-ridden airlines are Tata who were reportedly eyeing the stake in Air India. Its valuation of aircrafts will be at Rs 20,000-25,000 crore.
Air India's market share in domestic market has fallen to 14% in 10 years from 35% a decade ago, placing it third in the national ranking, behind Indigo, which commands about 40% of Indian skies, and Jet Airways, which has about 16% of the share.