A member of the Singapore Parliament, Kenneth Tiong Boon Kiat, has opposed any future use of Temasek funds to support Air India through Singapore Airlines. The Singapore based carrier owns about 25% of Air India. Temasek Holdings, Singapore government’s multinational investment firm, is the largest shareholder in Singapore Airlines.
The MP’s opposition stems from Singapore Airlines's latest results, where FY25 net income fell over 57% to S$1.2 billion, weighed down by a S$945 million loss linked to its Air India stake, Singapore media reported.
Indeed, despite political pushback, Temasek remains committed to the long game. As reported by The Economic Times, the Singapore state investor has explicitly backed Singapore Airlines’s strategy, noting that multi-year transformations of this scale are non-linear, and reiterating its willingness to take a long-term view on supporting the carrier's growth in Air India.
A matter of scale
While the MP’s duty to scrutinize public spending is well recognized, it is equally important to view this investment through the lens of Singapore’s geographic limitations as a compact aviation market. The population of Singapore is a little over six million people. Let us assume that each Singapore citizen takes two to three flights each year. That means the Singapore air market is about 12 to 18 million annually.
Compare this with India. In July 2026 alone, Indian carriers flew 12 million passengers. This is the figure for domestic passengers but Singapore is a city-state, so each passenger is travelling abroad. India recorded an outbound travel market of 31.7 million departures in fiscal year 2024-25. An airline investing in India will perforce enjoy the benefits of its domestic and international passenger market.
As far back as 2022, Goh Choon Phong, Singapore Airlines’s chief executive officer, said equity investment in Vistara had helped Singapore Airlines widen its geographic reach, leading to a significant boost in passenger base—thereby acknowledging that India provides an important passenger feed to the Singapore based airline. Singapore Airlines had a 49% stake in Vistara. Vistara was eventually merged with Air India with Singapore Airlines holding around 25% in the current Air India, which holds the second position with a domestic market share of around 20%. Given these numbers, Singapore Airlines’s investment is bound to pay off in the near future.
Long-haul recovery
The current Air India-Singapore Airlines returned to the Tata fold only in 2021 after decades of government control. The government took over Air India from JRD Tata in 1953 although the father of Indian aviation was allowed to run the airline until the early 1980s. After that, the government ran Air India, leading to huge losses, lack of accountability, a slow and tedious process of ordering aircraft and general disarray in the airline as a whole.
Take, for example, the ordering of aircraft. Before being divested, Air India last ordered aircraft in 2005. That means many of the aircraft that Tata-Sons-run Air India was operating were over 15 years old. After divesting Air India to Tata Sons, the government took over a debt of around ₹46,000 crore that the state owned government control had amassed. It was a mess.
Cleaning up a mess takes time. Besides, now the aviation eco-system has become global. Airbus and Boeing are the two producers of aircraft but manufacturing the aircraft is made possible by suppliers from around the globe including India. Engines that power Airbus and Boeing aircraft are also made globally as are seats and inflight entertainment systems.
Given that in less than a decade the world has passed through covid, which brought manufacturing to a halt globally, Air India had to stand in the queue of airlines wanting aircraft, seats and engines. Ordering aircraft to replace older aircraft currently in service added to the cost of the investment into the Maharaja.
Yet, fixating on these short-term costs risks missing the macro opportunity. India is already established as the world’s third-largest domestic aviation sector and remains one of its fastest-growing markets. With an expanding middle class, rapid fleet inductions, and major new infrastructure like Noida and Navi Mumbai airports boosting capacity, the market fundamentals are unmistakable. Singapore Airlines, as a partner in Air India, is set to reap the financial benefits in the long run although there are bound to be air pockets as the flight progresses.