An initial public offering of shares in state-run carrier Air India could be considered in the near future, depending on the revival of equity markets, India's aviation minister said Monday.

An IPO, mooted in 2007, was shelved as market turmoil last year spooked domestic and international investor appetite for new issues.

But the benchmark Indian stock index has risen 54 percent so far in 2009, after a 52 percent fall last year.

Analysts expect the rally to continue and many expect a raft of state-run firms to enter the equity markets.

"If the stock markets do better than what they have so far the IPO of Air India could also be considered in the near future," Praful Patel told reporters.

"Of course, it is not going to lose its public sector character, it is not going to be privatized or disinvested completely. It would bring in much needed equity infusion."

Patel declined to provide details on how much of the firm would be offered to the public or the share sale would net.

The Congress party-led government is seen rolling out reforms, including privatization and increasing foreign investment caps, to lift the economy and attract investment, after it was returned to power with a decisive mandate in last month's federal elections.

Patel sidestepped a question on whether the government would increase the 49 percent equity cap for foreign investors in Indian airlines, or allow foreign carriers take stakes in domestic ones.

"It is an evolving sector, it is a dynamic sector. The government decisions will also evolve... Civil aviation is not fixated in time. What was relevant in 2000 may not be relevant in 2009. It will evolve."