Air India has reportedly sought a ₹10,000 crore financial aid package from the Indian government to support its ongoing operations and debt management, as the airline continues its massive transformation program under the Tata Group.
Financial Support Request
According to industry sources, the airline’s management has requested the assistance to help offset rising fuel costs, currency volatility, and fleet expansion expenses. The funding, if approved, would be used to improve liquidity, finance aircraft acquisitions, and modernize infrastructure across domestic and international routes.
The request comes as Air India works toward completing its multi-year restructuring plan, which includes fleet renewal, route optimization, and a digital overhaul of operations.
Transformation Under Tata Group
Since its acquisition by the Tata Group in 2022, Air India has embarked on one of the largest turnarounds in global aviation history, placing record-breaking aircraft orders worth over $70 billion with Airbus and Boeing.
The airline has also invested heavily in training, customer experience, and technology, as part of its strategy to reclaim its position as a leading international carrier.
“The airline’s transformation is capital-intensive,” said an aviation analyst. “The financial infusion will ensure stability during a period of heavy investment and competitive pressure.”
Government’s Role
While Air India is now privately owned, the government remains a stakeholder in its broader aviation ecosystem, particularly through airport infrastructure and policy frameworks. Officials have not yet confirmed whether the aid will take the form of a soft loan, equity infusion, or credit guarantee.
Market Context
The airline sector in India is facing high operating costs and tight margins amid volatile fuel prices and a weaker rupee. Despite these challenges, Air India has reported steady growth in passenger traffic and continues to expand its global network.
Analysts believe that the requested funding could help accelerate Air India’s turnaround, positioning it to compete more effectively with global and domestic rivals.
