Air India has reported a wider-than-expected loss of over ₹220bn (billion) or around US$2.4bn for FY25-26, hit by a series of operational disruptions and geopolitical challenges,
according to a report by Bloomberg. The report says the airline is now seeking fresh financial support from its shareholders, including Tata group, which controls the carrier, and Singapore Airlines, which holds a 25.1% stake.
According to the Bloomberg report, discussions are ongoing regarding the size of the capital infusion, though it may fall short of the airline’s requirements, potentially forcing it to explore additional funding avenues.
Representatives of Tata group and Air India did not respond to queries, while Singapore Airlines declined to comment, Bloomberg says.
Citing people familiar with the matter, the report says that the loss for the financial year ended 31st March significantly exceeded the airline’s earlier internal estimate of about US$1.6bn.
Bloomberg reported that the losses were driven by a confluence of adverse events during the year, including a fatal crash involving a Boeing 787 Dreamliner, which killed more than 240 people and forced the airline to scale back operations.
The airline was also affected by the closure of Pakistani airspace to Indian carriers following tensions in May, leading to longer, more expensive flight routes to Europe and the US, according to the report.
Additionally, the ongoing conflict in the Middle East — a key region accounting for about 16% of Air India’s capacity — further disrupted operations and increased costs.
The report noted that external factors also weighed on the airline’s finances, including tariffs imposed by Donald Trump on India and tighter visa rules affecting international travel demand.
These challenges coincided with rising jet fuel prices, compounding cost pressures at a time when the airline was already struggling to improve yields and service standards.
Bloomberg also noted that Air India ranked poorly on safety metrics in the aviation regulator’s latest audit, raising concerns about operational standards.
Efforts to stem losses have become a key priority, with Bloomberg previously reporting that improving the airline’s financial performance is among the conditions tied to a potential third term for Tata group chairman Natarajan Chandrasekaran.
According to the report, the airline had started FY25-26 on a positive note, posting operating profits in early April 2025. However, the situation deteriorated rapidly after geopolitical tensions led to airspace restrictions and operational disruptions.
The cascading crises derailed Air India’s goal of achieving operational break-even during the fiscal year, the report says.
The report added that Singapore Airlines, which increased its stake following the merger of Vistara with Air India in 2024, has also seen its earnings impacted by the airline’s deteriorating performance.
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It seems that the usual Indian interference in an investigation to protect the higher-ups, the company image are preventing the release of the findings.
I would not want to fly an airline, no matter, how attractive the ticket price, if safety procedures are suspect.