Temasek backs Singapore Airlines to fly long haul with Air India

Mumbai: Singapore state investor Temasek has backed Singapore Airlines' investment in Air India, as a fresh funding request from the latter draws scrutiny in Singapore over the airline's growing exposure to the loss-making Indian carrier.

Temasek, which owns about 50.41% of Singapore Airlines (SIA), said it supports the carrier's long-term strategy despite the challenges facing Air India.

"As a shareholder of SIA, Temasek views their business decision from a long-term perspective and is supportive of it," Juliet Teo, joint head of portfolio development and head of ecosystem enablement at Temasek Singapore, said in a statement published on its website on Saturday. Singapore Airlines holds a 25.1% stake in Air India, with Tata Sons owning the rest.


Air India has sought around $1.5 billion in fresh equity from its owners, Reuters reported earlier this week.

The funding request has triggered concerns in Singapore. Kenneth Tiong, a lawmaker from the opposition Workers' Party, has urged the government to ensure that Temasek's funds are not used to shore up the Indian carrier."No one, least of all Singaporeans, owes Air India a living... 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," Tiong said in a note.

He sought oral answers from Singapore's transport minister Jeffrey Siow during the upcoming parliamentary session on September 8, ET reported earlier. Teo, however, said Temasek 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," she explained.

Singapore Airlines could be facing a fresh capital call after reporting its first quarterly loss since 2022. The result came despite record revenue, as weaker performance at Air India and a sharp increase in jet fuel costs weighed on the group. Its investment in Air India has become a growing financial burden for SIA.

Challenges Since 2024

Over the past two years, the Singapore carrier has recorded around S$1.3 billion ($780 million) in operating losses linked to its stake in the Indian airline, although that figure has improved from S$2.02 billion on its balance sheet as of March 31, 2025. SIA recognised S$945.2 million (approximately $740 million) as its share of Air India's losses for FY2025/26.

The challenges have compounded since SIA committed to Air India in November 2024. The investment was followed by the Ahmedabad aircraft crash, restrictions that forced Indian airlines to avoid Pakistani airspace, and a subsequent surge in fuel prices. Together, these developments have added pressure to an investment that has yet to deliver the returns SIA had anticipated.

Defending Temasek's investment in SIA, Teo said, "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."