Singapore Airlines owner Temasek backs Air India investment amid concerns in city-state

Temasek, the Singapore government-owned investment company that is the majority shareholder in Singapore Airlines (SIA), said Saturday that it backs SIA’s investment in Air India, and views it from a long-term view of securing growth beyond the city-state.

Temasek’s statement, which came amid concerns being raised in Singapore over the loss-making Air India seeking fresh capital infusion from its shareholders Tata Sons and Singapore Airlines; the latter holds 25.1% stake in the Indian airline.

“As a shareholder of SIA, we view their business decision from a long-term perspective and are supportive of it. We recognise that the large-scale transformation of Air India involves complex, multi-year operational and integration challenges.

Efforts of this scale take time and are not expected to be linear, particularly in the aviation sector, where outcomes are shaped by industry developments, including aircraft innovation and fleet renewal cycles, and external factors such as airspace disruptions, geopolitical developments, and fuel price volatility,” Temasek said in its statement.

Air India, which is implementing an ambitious and cash-guzzling transformation programme, is also struggling due to external headwinds like the Pakistani airspace closure, West Asia conflict-related disruptions, and sky high fuel prices.

The airline, which was taken over by the Tata group from the government in January 2022, recently sought about $1.5 billion from its shareholders, it is learnt. In a social media post on Wednesday, Kenneth Tiong, an opposition MP in Singapore’s parliament, raised concerns over Singapore Airlines investing further in Air India, and the consequent impact it could have on Temasek.

Singapore-based newspaper The Business Times published an opinion piece on Singapore Airlines's exposure to Air India, saying that SIA faced some “bleak choices” as it lay “trapped in Air India’s money pit”. The publicly issued statement by Temasek on Saturday was in response to the article.

According to Temasek, SIA has articulated its objective to invest in a second hub to secure long-term growth beyond Singapore, and as the world’s third-largest aviation market, India is well-positioned to serve as this second hub.

It added that SIA has long participated in the India market, including an operating presence through Vistara since 2013 and its investment in Air India “allows it to deepen its participation in India's aviation growth”. “As we build a resilient and forward-looking portfolio, we support the strategic moves by our portfolio companies that position them for long-term growth and global competitiveness.

While such initiatives take time, we believe that they are important for sustaining growth over the long run,” the Singapore state investment firm added. On Thursday, a day after Tiong opposed use of Temasek’s funds via SIA to support Air India, Singapore Airlines said that its board will “carefully consider” any requests for additional capital from Air India, “taking into consideration the Group’s other capital requirements and Air India’s business strategy”.

“The SIA Group’s capital allocation follows a disciplined evaluation process that considers its operating cash flow, investment requirements in new aircraft and products, as well as multi-hub investments such as Air India, to support sustainable long-term growth and returns,” an SIA spokesperson had said.

In a social media post on Wednesday, Tiong had said, “Singapore Airlines owns about a quarter of it (Air India), and Temasek owns most of Singapore Airlines, so this is not only a question for private shareholders. Whichever of the two writes the cheque, it will have a significant impact on Temasek…No one, least of all Singaporeans, owes Air India a living.

I will not support, nor expect, any future use of Temasek's funds to prop up Air India via Singapore Airlines. If Singapore Airlines wants to continue its bet on Air India, it should do so on its own two feet, and not on Temasek’s,” The Singapore lawmaker added that he has submitted a question to Singapore’s transport minister on the issue.

“I have filed a question for oral answer for the 8 September sitting, asking the Minister for Transport whether these losses have been assessed against SIA's capacity to provide essential transport services, and whether they engage the notification duty that comes with SIA's designated status under the Civil Aviation Authority of Singapore Act,” Tiong said.

Tiong posted that Tata Sons chairman N Chandrasekaran, who is also the chairman of Air India, recently said that the airline's turnaround could take up to a decade, and now Chandrasekaran himself is slated to step down from his position in February 2027.

The Singapore MP also flagged that SIA slipped into losses in the April-June quarter, which was partly due to the Air India group’s heavy losses, apart from the external challenges faced by SIA itself due to the West Asia conflict.

SIA’s profit for 2025-26 fell 57% year-on-year to the equivalent of about Rs 9,000 crore, partly due to its 25.1% shareholding in Air India, which reported losses of around Rs 27,000 crore for the year that saw it struggling due to the external challenges and a devastating plane crash.

In the April-June quarter, SIA posted a loss that was equivalent to Rs 570 crore. In the Tata Sons 2025-26 annual report, Chandrasekaran had described rebuilding Air India as an airline of global repute as a “long journey”, saying that its transformation must be seen as a five- to ten-year journey.

He had also said every great airline in history was built over decades, not quarters. Sukalp Sharma is a Deputy Associate Editor with The Indian Express and writes on a host of subjects and sectors, notably energy and aviation.

He has over 16 years of experience in journalism with a body of work spanning areas like politics, development, equity markets, corporates, trade, and economic policy. He considers himself an above-average photographer, which...