Temasek supports Singapore Airlines backing AI; 'such initiatives take time'

NEW DELHI: "Efforts of this scale take time.." With these words, Singapore Airlines' (SIA) majority stakeholder and the city state's state investor Temasek has supported the airline backing Air India from a strategic long term viewpoint of having a second hub beyond Changi.The Maharaja has sought additional fund infusion of about $2 billion from Tata Sons (74.9% stakeholder) and SIA which owns the remaining 26.1% stake in AI. Singapore opposition MP Kenneth Tiong had opposed using state investor Temasek’s funds to meet AI request.Now Temasek has clarified its position in a letter to a business newspaper: "SIA has demonstrated discipline and resilience through industry cycles, and consistently positioned itself for long-term growth.... 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. 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. 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."SIA had Thursday said it will “carefully consider any requests for additional capital from AI, taking into consideration the group’s other capital requirements and AI’s business strategy.”AI has returned to its shareholders for funds more than a year after Tata Sons halted fresh equity injections into the airline, as its turnaround proves costlier and slower than initially envisaged. The amount would rank among the largest shareholder funding exercises since Tata Group regained control of the former state carrier in 2021.Tata Sons had paused additional equity support in the year to March 2026. Its investment in AI stood unchanged at Rs 22,618 crore in the FY2026 report, the same level as a year earlier — indicating no fresh equity was infused during the year.Air India reported a loss of Rs 22,238 crore in FY2026, more than double the previous year’s deficit and the largest among Tata Group companies. Air India has been the worst-hit Indian carrier from the closure of Pakistani airspace since last April, given the volume of flights it runs west from its Delhi hub — from the UAE to North America. The next blow came when its London-bound Dreamliner crashed in Ahmedabad last June, killing 260 people, forcing further flight cuts. The February 28 US-Iran war then sent oil prices higher and the rupee lower, lengthening Delhi’s already longer western routes and driving up operating costs — while Air India competed against western carriers overflying Pakistan on far shorter paths.Get the latest Business News and Live updates. Download the TOI app.