Temasek backs Singapore Airlines' investments in Air India

Singapore's sovereign wealth fund Temasek on Saturday said it supports Singapore Airlines' investments in Air India and highlighted that the Indian carrier's large-scale transformation involves complex, multi-year operational and integration challenges.

A statement from Temasek, which is a stakeholder in Singapore Airlines (SIA), comes against the backdrop of concerns raised in certain quarters about the carrier's investment in the loss-making Air India.

Singapore Airlines owns a 25.1 per cent stake in Air India, and the remaining shareholding is with Tata Sons, which acquired the Indian airline from the government in January 2022.

In a statement on Saturday, Temasek said SIA has articulated its objective to invest in a second hub to secure long-term growth beyond Singapore.

"As the world's third-largest air transport market after the US and China, India is well-positioned to serve as this second hub. 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," it said.

Temasek said that as a shareholder of SIA, "we view their business decision from a long-term perspective and are supportive of it".

Earlier this week in a social media post, Singapore's Member of Parliament Kenneth Tiong Boon Kiat cited a media report and flagged concerns about Singapore Airlines investing more in Air India.

"Air India has asked its owners for another USD 1.5 billion. Singapore Airlines owns about a quarter of it, 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," he had said in a Facebook post.

Singapore Airlines Group's net profit dropped 57 per cent to SGD 1.184 billion (nearly Rs 8,900 crore) in the fiscal year ended March 2026, mainly due to the absence of a prior-year one-off accounting gain related to the Vistara merger, and Air India losses.

Air India's loss stood at more than SGD 3.56 billion (over Rs 26,700 crore) in the financial year ended March 2026, as the carrier grappled with the fallout of airspace curbs and other headwinds.

Figures were disclosed by Singapore Airlines Group in its annual financial report for 2025-26, released in May. The rupee figures are based on the exchange rate of May 14.

Sources earlier this week said Air India is planning to seek additional funds to the tune of USD 1.5 billion, which is over Rs 14,000 crore at the current exchange rate.

On Saturday, Temasek also said it recognises 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," it said in the statement.

Meanwhile, on August 27, Singapore Airlines said its board will carefully consider Air India's any requests for additional capital after taking into consideration the group's other capital requirements, as well as the Indian carrier's business strategy.

N Chandrasekaran, Chairman of Tata Sons and Air India in July, said Air India's transformation journey must be seen as a five- to ten-year journey considering the years-long supply chain disruptions in key components, the need to overhaul the legacy systems, culture, fleet and creation of a large cadre of airline professionals.

Earlier this month, Chandrasekaran announced he would step down as Tata Sons Chairman when his current term ends in February 2027.

In the Facebook post earlier this week, Kenneth Tiong Boon Kiat also said that 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," he had said.

Kenneth Tiong Boon Kiat said he has also filed a question for oral answer from Singapore's Minister of Transport on 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.

The question is scheduled to be taken up during Parliament's sitting on September 8.