Air India formally became a part of the Tata Group on Thursday, three months after the country's oldest and largest conglomerate won the bid to take over the embattled airline.
The transaction covers three entities – Air India, budget operator Air India Express and AI SATS, a provider of ground- and cargo-handling services, group owner Tata Sons said.
“We are excited to have Air India back in the Tata Group and are committed to making this a world-class airline. I warmly welcome all the employees of Air India, to our group, and look forward to working together,” said Tata Sons chairman N Chandrasekaran.
Mr Chandrasekaran met India's Prime Minister Narendra Modi on Thursday before the official handover, and was joined by Ratan Tata, chairman Emeritus of Tata Sons, in expressing his gratitude to the government of India for the successful completion of this transaction.
The Indian government sold the debt-laden airline to Tata after concluding a 180-billion rupee ($2.39bn) deal in October for a 100 per cent stake in the company.
Tata is preparing a 100-day plan to improve Air India's operations and service standards, including upgrading its meals on offer, financial daily Economic Times reported.
“The Tata Group intends to implement the changes in phases, as turning this airline profitable is challenging not only financially but also operationally,” said Gaurav Garg, head of research at CapitalVia Global Research.
The airline has long been considered to be a drain on government finances, which could be better spent on areas including infrastructure and health care. Air India has not turned a profit since 2007, when it merged with Indian Airlines.
Analysts believe that the privatisation of Air India will be positive for the airline and that it will significantly improve its performance.
The airline's cabin crew this week received information that they should be smartly-dressed and will be assessed by “grooming associates”, magazine India Today reported.
Air India has a large workforce of about 8,000 employees, which Tata will have to keep on for at least a year, under the terms of the deal.
“Radical changes such as fleet and cabin upgrades would take time,” Mr Garg said.
Tata already has a wealth of experience in the sector. The airline was started by the group's founder JRD Tata in 1932 under the name Tata Airlines, before it was nationalised about 20 years later.
Today, it has joint ventures in the form of airline Vistara, which it co-owns with Singapore Airlines, and AirAsia India.
Tata has interests spanning from energy to property, while brands under its ownership include Jaguar Land Rover.
However, the group is expected to face tough market conditions. Airlines in India have long struggled with profitability because of fierce competition from budget rivals and high taxes.
The Covid-19 pandemic has come as another blow to the entire aviation industry, given the disruption it has caused to travel.
“The challenge is sector dynamics: high capital intensity, operational costs and cut-throat competition,” said Richa Agarwal, a senior research analyst at Equitymaster.
“And on that front, things will be getting difficult for incumbents, with the privatisation of Air India, [the planned] launch of Akasa Air and Jet Airways resuming operations.”
“All in all, the consumers will benefit but for industry players, it is going to be a challenging flight," she said.
Meanwhile, Air India has coveted landing slots including London Heathrow, and after the pandemic, the number of people travelling by air from India is expected to surge over the coming years.
Despite this, the Indian government's previous attempt to sell Air India in 2018 failed to attract a single bidder.
After that, New Delhi reduced the amount of debt that the new owner would have to take on, and allowed potential buyers to full ownership of the airline, which helped to attract more interest and resulted in its long-awaited privatisation.
The bio:
Favourite film:
Declan: It was The Commitments but now it’s Bohemian Rhapsody.
Heidi: The Long Kiss Goodnight.
Favourite holiday destination:
Declan: Las Vegas but I also love getting home to Ireland and seeing everyone back home.
Heidi: Australia but my dream destination would be to go to Cuba.
Favourite pastime:
Declan: I love brunching and socializing. Just basically having the craic.
Heidi: Paddleboarding and swimming.
Personal motto:
Declan: Take chances.
Heidi: Live, love, laugh and have no regrets.
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
The National's picks
4.35pm: Tilal Al Khalediah
5.10pm: Continous
5.45pm: Raging Torrent
6.20pm: West Acre
7pm: Flood Zone
7.40pm: Straight No Chaser
8.15pm: Romantic Warrior
8.50pm: Calandogan
9.30pm: Forever Young
MATCH INFO
Manchester City 2 (Mahrez 04', Ake 84')
Leicester City 5 (Vardy 37' pen, 54', 58' pen, Maddison 77', Tielemans 88' pen)
Man of the match: Jamie Vardy (Leicester City)
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Name: Dr Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
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Manchester United 1 (Greenwood 77')
Everton 1 (Lindelof 36' og)
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Rating: 4/5
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Dir: John Lucas and Scott Moore
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Two stars
Expo details
Expo 2020 Dubai will be the first World Expo to be held in the Middle East, Africa and South Asia
The world fair will run for six months from October 20, 2020 to April 10, 2021.
It is expected to attract 25 million visits
Some 70 per cent visitors are projected to come from outside the UAE, the largest proportion of international visitors in the 167-year history of World Expos.
More than 30,000 volunteers are required for Expo 2020
The site covers a total of 4.38 sqkm, including a 2 sqkm gated area
It is located adjacent to Al Maktoum International Airport in Dubai South
The Settlers
Director: Louis Theroux
Starring: Daniella Weiss, Ari Abramowitz
Rating: 5/5
'Spies in Disguise'
Director: Nick Bruno and Troy Quane
Stars: Will Smith, Tom Holland, Karen Gillan and Roshida Jones
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Jetour T1 specs
Engine: 2-litre turbocharged
Power: 254hp
Torque: 390Nm
Price: From Dh126,000
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Ain Issa camp:
- Established in 2016
- Houses 13,309 people, 2,092 families, 62 per cent children
- Of the adult population, 49 per cent men, 51 per cent women (not including foreigners annexe)
- Most from Deir Ezzor and Raqqa
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Our family matters legal consultant
Name: Dr Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
All Blacks line-up for third Test
J Barrett; I Dagg, A Lienert-Brown, N Laumape, J Savea; B Barrett, A Smith; J Moody, C Taylor, O Franks, B Retallick, S Whitelock, J Kaino, S Cane, K Read (capt).
Replacements: N Harris, W Crockett, C Faumuina, S Barrett, A Savea, TJ Perenara, A Cruden, M Fekitoa.
