Air India Express Raises Borrowing Limit to ₹17,500 Crore Amid Financial Strain

Air India Express Raises Borrowing Limit to ₹17,500 Crore Amid Financial Strain​

Air India Express has increased its borrowing limit to ₹17,500 crore to manage cash flows and operations, marking the third rise since merging AirAsia India in 2024. The move reflects deepening financial challenges at the Tata Group’s low-cost carrier, compounded by disruptions in West Asia.

Financial Situation Deteriorates​

The budget airline has seen significant losses widen, despite revenue growth. As of March 2025, Air India Express carried a debt burden of ₹10,087.4 crore (excluding lease liabilities). The newly approved borrowing limit now allows the airline to potentially reach ₹17,500 crore, exceeding its revenue of ₹16,033 crore from the previous fiscal year. Revenue rose 26% year-on-year to ₹16,033 crore in FY25, while losses expanded more than fourfold to ₹5,822 crore. Debt increased by 61% from ₹6,261.7 crore a year earlier to ₹10,087.4 crore. This translates to a loss of approximately ₹36 for every ₹100 of revenue.

Comparison with Air India​

In contrast, Air India’s revenue increased 13% to ₹61,080 crore in FY25. Under CEO Campbell Wilson, the parent airline reduced its losses from ₹5,031 crore to ₹3,976 crore. Air India’s standalone borrowings stood at ₹29,713 crore in FY25, a decrease of over 8% from ₹32,465 crore in FY24.

Fleet Expansion Plans​

Air India Express currently operates a fleet of 105 aircraft and anticipates adding 20–24 narrow-body planes this year.

Group Losses and Investments​

Combined losses from Air India Express and its subsidiary, AI Fleet Services, reached ₹9,798 crore. However, two joint ventures, Air India SATS Airport Services and Airbus India Training Centre, reported a profit of ₹510 crore. Tata Sons has invested nearly $5.1 billion in its e-commerce ventures – BigBasket, Tata 1mg, Croma, and Cliq – which remain loss-making.

Leadership Changes and Competition​

Captain Hamish Maxwell has been appointed as manager and key managerial personnel for a one-year tenure, with a potential earning of up to ₹9.5 crore. Air India Express competes with IndiGo in domestic operations and also serves routes to West Asia and Southeast Asia. IndiGo recently appointed Aloke Singh as its chief strategy officer.

Borrowing Limit Increase​

In February 2026, Air India Express shareholders approved a special resolution to enhance the overall borrowing limits by ₹3,500 crore, as filed with the ministry of corporate affairs on March 20. This increase is intended to support the airline’s annual operating plan and manage cash flows for the fourth quarter (January-March).