Finance Minister Sitharaman urges Tata to resolve feud amicably, rules out govt intervention

Finance Minister Nirmala Sitharaman on Monday noted the ongoing differences between Tata Sons and its largest shareholder, Tata Trusts, should be resolved amicably at the earliest.

Speaking at a Finance Express event, she emphasised that the Tata Group matter is critical for the Indian economy and should not spill into the public domain.

Also read: Darius Khambata does not seek re-appointment on Sir Dorabji Tata Trust and Sir Ratan Tata Trust as his term ends


Terming the matter 'sensitive', Sitharaman declined to comment on whether the government will take efforts to engage both sides in discussions.

Amid foreign investor outflows and growing calls for tax cuts, she declined to say anything specific, stating that she is sensitive to the "louder" voices of concern.

"This is a very critical component to Indian economy and therefore, it has to be amicably settled among themselves, so they talk it out to make sure that it comes back quickly to some normalcy," the finance minister said, adding that it cannot be spilling out like this in the public and for the maturity of that leadership, the government would like to have this seen settled sooner.

Describing the Tata Group issue as delicate, Sitharaman said it required commercial acumen and cordiality among stakeholders, while expressing hope that the leadership would resolve the differences and restore normalcy at the earliest.

The finance minister also acknowledged the Parsi community's contributions, which helped make Tata a global brand and also the expanse of activities that the conglomerate is invested in.

What's happening at the Tata Group?

Corporate tensions have been brewing at the 158-year-old Tata group for the past few months amid a vertical split between the board of its holding company Tata Sons led by N Chandrasekaran and its largest shareholder Noel Tata-headed Tata Trusts at a board meeting on September 17.

The board meeting held within a week of the Reserve Bank of India (RBI) letter rejecting Tata Sons' request to de-register as a core investment company decided to go for a listing as per the central bank's mandate. The company also reappointed Chandrasekaran as Chairman of Tata Sons.

The only dissenting vote at the crucial Tata meeting came from Noel Tata, while the gathering saw Tata Trusts' second nominee director Venu Srinivasan breaking ranks and voting with the majority.

Also read: Noel Tata seeks board scrutiny of SP Group's Rs 25,000 crore exit plan, Tata Sons restructuring

Sitharaman acknowledges concerns on foreign capital outflows

Finance Minister Sitharaman also acknowledged concerns over foreign capital outflows from the Indian market and the need to support equity investments, saying the government recognised the anxiety among retail investors and market participants.

She further noted that the taxation structure was similar in 2023-24, when India witnessed its highest foreign investment inflows, but said circumstances had changed with increased net outflows recorded by foreign institutional investors (FIIs). While inflows had started resuming, she said the government recognised growing concerns of the market.

Emphasising the importance of capital, particularly equity capital, in sustaining India's economic growth, the finance minister said the government would consider concerns raised by market participants.

"At a time when our growth is very important, where people are putting their very best, we are able to see sustained seven-plus growth. In order to keep that intact, we need capital and equity, particularly now," she noted.

(With inputs from PTI)