Air India Express has raised its borrowing limit to Rs 17,500 crore as it navigates financial losses and operational turbulence, aiming to strengthen liquidity and sustain operations amid challenges in the aviation sector. It also highlights the mounting pressure on the Tata Group’s aviation bet.
Air India Express has raised its borrowing limit by 25% to Rs. 17,500 crore to fund near-term and next-fiscal operations. This marked its third increase since merging with AirAsia India in 2024. It highlights continued turbulence at the Tata Group’s low-cost carrier.
“In order to manage Q4 (January-March 2026) cash flows and support the annual operating plan, it is proposed to enhance the overall borrowing limits by ₹3,500 crore,” said a special resolution passed by Air India Express shareholders at a meeting on 24 February and filed with the Ministry of Corporate Affairs on 20 March.
Under the Companies Act, 2013, a special resolution requires approval by at least 75% of the votes cast by shareholders.
“The airline has increased borrowing limits and it is perhaps also an indication that it wants to expand. The Middle East conflict has severely impacted its operations and profitability. May be it will try to increase domestic operations or tap the Indian market more, specially the smaller city—larger city routes, and is accordingly making provisions for funds. It is also not necessary they will be using the entire borrowing limit, it could be just an enabling provision too,” G.S. Bawa, secretary general, Air Travellers Association (ATA), a consumer rights group.
Air India Express, a wholly-owned subsidiary of Air India, first raised its borrowing limit to Rs. 11,600 crore in October 2024, followed by a further increase to Rs. 14,000 crore in November 2024.
The airline ended March 2025 with Rs. 10,087.4 crore in debt (excluding lease liabilities). With the revised ceiling, it can now borrow up to Rs. 17,500 crore. This figure would exceed its Rs. 16,033 crore revenue last year.
Revenue rose 26% year-on-year to Rs. 16,033 crore in FY25. However, losses expanded more than fourfold to Rs. 5,822 crore.
Debt (excluding lease liabilities) jumped 61% from Rs. 6,261.7 crore a year earlier to Rs. 10,087.4 crore.
Put simply, Air India Express lost about Rs. 36 on every Rs. 100 of revenue.
In comparison, parent Air India’s revenue rose 13% to Rs. 61,080 crore in FY25. Under CEO Campbell Wilson, it cut losses to Rs. 3,976 crore from Rs. 5,031 crore a year earlier. It translates into a loss of roughly Rs. 6.5 for every Rs. 100 earned.
Air India’s standalone borrowings (excluding lease liabilities) stood at Rs. 29,713 crore in FY25, down over 8% from Rs. 32,465 crore in FY24, as per filings with the Ministry of Corporate Affairs.
The move signals deepening financial strain at the budget airline, which has seen losses widen sharply even as revenue grows. With crude prices rising and West Asian airspace closures disrupting operations, the higher borrowing ceiling gives the airline breathing room to manage cash flows.
Air India’s standalone losses were Rs. 3,976 crore, while Air India Express’ standalone losses were Rs. 5,822 crore, taking combined losses from the two airline businesses to Rs. 9,798 crore.
Air India Express currently has a fleet of 105 aircraft, according to a company official. The airline expects to add 20–24 narrow-body planes this year, the official said.