Air India Turnaround Is A Tata Responsibility, Not Just Business: N Chandrasekaran

Tata Sons Chairman N. Chandrasekaran described the ongoing revival of Air India as a deep institutional responsibility for the Tata Group rather than merely a commercial venture.

Speaking at the commemoration of the 121st birth anniversary of J.R.D. Tata, Chandrasekaran said, the transformation journey remains tough yet essential. He highlighted the capital-intensive character of aviation, notoriously low profit margins, and the unpredictable nature of the business, yet emphasised the enormous long-term opportunity ahead, according to a report by PTI.

A Duty Rooted in Legacy

Chandrasekaran emphasised that restoring the national carrier to global standards extends beyond profit motives for the conglomerate. The group took over the loss-making Air India and its low-cost arm Air India Express in January 2022 and immediately launched an ambitious five-year overhaul plan.

Persistent Global Headwinds Slowing Progress

Despite strong intent, the transformation has moved more slowly than originally planned. Chandrasekaran pointed out that the entire aviation ecosystem is battling severe supply-chain disruptions, making the timely availability of spare parts, airport infrastructure upgrades, and new aircraft highly unpredictable. These external factors have repeatedly forced the airline to revise its timelines for fleet expansion and cabin refurbishment.

Capital-Intensive Industry with Razor-Thin Margins

The Tata Sons chief reminded that the aviation sector remains one of the most capital-intensive sectors in the world, characterised by extremely narrow profit margins and constant volatility, making long-term planning particularly difficult.

India’s Growth Story: The Big Aviation Multiplier

On a more optimistic note, Chandrasekaran highlighted the extraordinary leverage India’s economic expansion offers to air travel. He explained that every one percentage point increase in national GDP typically translates into roughly two percentage points of growth for domestic aviation. 

At the current trajectory of around 8 per cent annual GDP growth, the sector could see close to 16 per cent expansion each year; a trend he expects to continue for at least the next thirty years.

“This will be one of the most exciting phases of economic growth for the country, and especially for Indian aviation,” he added