Temasek backs Singapore Airlines' Air India investment amid growing scrutiny

Temasek, the Singapore state investor and majority owner of Singapore Airlines, has endorsed the airline's decision to put money into Air India, according to Business Recorder. The show of support came on Saturday, amid closer examination of its holding in the loss-making Indian airline. Reuters had earlier reported that Air India wants roughly $1.5 billion of new equity, to be provided by Tata Sons and Singapore Airlines.

Opposition lawmaker Kenneth Tiong had urged that Temasek's funds not be used to prop up the Indian carrier. In a letter to the Business Times, Juliet Teo of Temasek said the group backed the investment with a long-term view. She cited complex, multi-year challenges shaped by airspace disruptions, geopolitical events and fuel price swings, but did not say whether Temasek would support any capital injection from Singapore Airlines.

Air India has faced Pakistan's restriction on Indian carriers' use of its airspace, disruption from the US-Israeli war with Iran, and fallout from a crash last year that claimed 260 lives. Over the year ending March, Air India and its low-cost arm Air India Express recorded a combined $2.33 billion loss, which has weighed on Singapore Airlines' earnings. On Thursday, Singapore Airlines said its board would weigh any capital requests from Air India carefully, given the group's other capital needs and the Indian carrier's strategy.