Air India Group clocked a record loss of more than $2 billion in Fiscal 2026, according to shareholder Singapore Airlines’ annual report, as India’s second-largest airline grappled with disruption from the Iran war and Pakistan’s ban on Indian carriers from its airspace.
In the report released on Thursday, Singapore Airlines, which owns a 25% stake in Air India, said the Indian airline’s loss amounted to 3.56 billion Singapore dollars, or $2.80 billion at current exchange rates, for the fiscal ended 31 March.
Singapore Airlines did not indicate the exchange rate it had used to calculate the loss. Reuters previously reported that Air India was expected to post an annual loss of over $2.12 billion.
The loss will be another major setback for Air India, which has been forced to cut scores of international flights in recent months, hitting turnaround plans at the Tata Group-owned airline.
In a report included with SIA’s disclosures, its auditor KPMG said the company’s management saw “indicators of impairment” for the Air India investment, citing challenging operating conditions and heightened geopolitical uncertainty.
Air India, which is not listed in India and has not yet filed its earnings with local regulators, declined to comment. Its 2024-25 standalone loss stood at $415 million, with consolidated losses when including budget operator Air India Express of $1.13 billion.
“Air India faces headwinds such as industry-wide supply chain constraints, airspace restrictions, constraints on operations to its key Middle East markets, and elevated jet fuel prices,” SIA said in a statement, adding that it was committed to its investment in the group.
Air India’s flight cuts are a boon for foreign carriers, with Lufthansa Group and Cathay Pacific among those adding services to one of the world’s fastest-growing aviation markets, Reuters reported on Thursday.
Air India has also been facing intense scrutiny since last year’s Dreamliner crash in Gujarat, India, which killed 260 people.
SIA warned that surging fuel costs due to the Iran war were still “filtering through” and would weigh more heavily in the year ahead, as it reported a smaller-than-expected 57.4% drop in annual profit.