Tata Sons’ board has approved an in-principle fresh capital infusion of more than Rs 10,000 crore into Air India. The proposed investment would be one of Tata Group’s largest commitments to Air India since it acquired the airline for Rs 18,000 crore in 2021.

The approval was reportedly given at a Tata Sons board meeting in June, chaired by Tata Sons chairman N Chandrasekaran and attended by Tata Trusts chairman Noel Tata and vice-chairman Venu Srinivasan. The proposed funding remains subject to certain conditions. Air India and other investee companies will be required to present a business case when seeking funding.

“Any capital infusion will require Air India and other investee companies to present a business case when funding is sought,” one person said. Under Article 121A of Tata Sons’ articles of association, investments exceeding Rs 100 crore require majority approval from Tata Trusts’ nominee directors.

The proposed capital infusion comes more than a year after Tata Sons paused equity infusions into Air India. According to the report, Air India’s losses more than doubled to Rs 22,238 crore in FY26. Tata Sons’ FY26 annual report showed that its investment in Air India remained unchanged at Rs 22,618 crore, indicating that no fresh equity was infused during the financial year.

The airline instead relied on borrowings and other financing, taking its outstanding debt to around Rs 40,000 crore across 11 lenders. State Bank of India has the largest exposure at around Rs 18,500 crore, followed by Bank of Baroda at Rs 5,938 crore.

Tata Sons’ ability to provide additional support to lenders is also constrained by its decision to stop issuing corporate guarantees or letters of comfort while its application to surrender its core investment company registration remains pending with the Reserve Bank of India.

Tata Sons currently owns 73.8% of Air India, while employees hold around 1.5% through SBICAP Trustee Co and Singapore Airlines holds 24.7%. To maintain its existing stake and avoid dilution following a fresh equity infusion, Singapore Airlines would need to invest around Rs 3,350 crore ($351 million).

Tata Sons’ board is scheduled to meet on September 17, following a September 11 meeting of Tata Trusts, excluding Sir Ratan Tata Trust (SRTT). SRTT has been barred from holding board meetings since May pending an inquiry into alleged violations of the Maharashtra Public Trusts Act. However, according to people familiar with the matter, the restriction does not affect the voting rights of Tata Trusts’ nominee directors.

Tata Sons and Tata Trusts declined to comment on the reported capital infusion. If approved and implemented, the proposed investment would provide additional capital support to Air India as the airline works through rising debt and losses while continuing its broader transformation under the Tata Group.