SINGAPORE: The Singapore government says it will not interfere in any decision that Singapore Airlines Ltd makes in Air India Ltd, which is said to be seeking financial aid from its shareholders.
Singapore Air has the responsibility to “assess its investments in Air India in relation to the resources it has for the long-term growth and profitability of the company”, Senior Minister K Shanmugam told reporters last Saturday.
It’s the Singapore government’s principle to not intervene in individual investment decisions, or put political pressure, he said.
“Once governments or politicians start directing individual investment decisions, commercial discipline will be compromised,” he said. “Decisions will become politicised – shaped by political considerations, rather than commercial judgment. In the end, Singaporeans will bear the cost.”
Air India is close to securing 100 billion rupees (US$1.1bil) in aid from its owners Tata Sons Pvt and Singapore Air, as the carrier grapples with the fallout from a turbulent year, people familiar with the matter told Bloomberg last week.
The money is conditional on reaching certain performance milestones and will be paid out in installments, said the people. — Bloomberg
