Air India Ltd. racked up a wider-than-expected annual loss of more than 220 billion rupees ($2.4 billion), prompting the company to seek financial aid from its shareholders, according to people familiar with the situation.
The loss for the fiscal year ended March 31 — a period punctuated by the deadly crash of a Boeing Co. 787 Dreamliner, the closure of Pakistani airspace to Indian carriers and the Middle East conflict — is larger than $1.6 billion internal company loss estimate reported by Bloomberg News in January.
Air India’s controlling shareholder, Tata Group, as well as Singapore Airlines Ltd. — which owns 25.1% in the carrier — are in talks to inject some much-needed cash, said the people, who asked not to be identified discussing private information. The size of the infusion is still being discussed but may be less than what the carrier needs, meaning Air India would have to look for other financing options, the people said.
Representatives for Tata Group and Air India didn’t respond to an email seeking comments while Singapore Air declined to comment.
The record loss comes at a critical juncture for Air India. Chief Executive Officer Campbell Wilson last week announced his intention to step down later this year. The airline was ranked worst for safety issues in the aviation regulator’s latest annual audit, and despite ambitious fleet expansion plans has struggled to lift yields and improve service to desired levels.
Stemming the losses has also been set as one of the key conditions for approving a third term for Tata Group Chairman Natarajan Chandrasekaran, Bloomberg News reported in February.
The airline had started the fiscal year on a positive note, posting operating profits in the first few weeks of April 2025, the people said. That turned after Pakistan closed its airspace to Indian airlines following a brief conflict in May, forcing them into longer routes to the US and Europe.
A deadly crash in June of a Boeing Dreamliner, which killed more than 240 people, sent the carrier reeling, prompting it to reduce international and domestic services.
US President Donald Trump’s punitive tariffs on India and a crackdown on foreign worker visas also hit the carrier’s bottom line, the people said.
The rolling crises have thwarted the airline’s target to break even operationally in the fiscal year ended March 31.
Air India has also been one of the foreign carriers most affected by the outbreak of hostilities in the Middle East — a region which accounts for 16% of its total capacity and which is now largely grounded, the people said. The conflict has further impacted flights to Europe and America, which now must take longer, more costly routes at a time when jet fuel prices have surged.
Singapore Air, which took a minority stake in Air India after merging local affiliate Vistara with the carrier in 2024, has seen its own earnings dragged down by the worsening performance.
