Tata plans ₹500cr trust for Air India crash victims' families
What's the story
Tata Sons, the holding company of the $400-billion Tata Group, has proposed to set up a trust with an estimated allocation of ₹500 crore. The move is aimed at providing financial support to the families of those who perished in the Air India crash in Ahmedabad on June 12. The proposal was presented by Chairman N Chandrasekaran at an interim board meeting, according to The Economic Times.
Trust details
One unified trust instead of 2 separate trusts
The proposed trust will benefit the families of both Indian and foreign nationals who died in the crash. Earlier, Tata Sons had considered setting up two separate trusts: one for Indian citizens and another for foreign nationals. The funds from this trust will be used for compensation payouts to the families of the victims, medical care, and renovation of an affected medical school in Ahmedabad.
Fund allocation
Outside individuals will also be included in the trust
The remaining funds in the trust will be reserved for the long-term needs of the affected families. The initiative is being led by PB Balaji, Group CFO of Tata Motors, who has extensive experience in regulatory, financial, and corporate governance matters. The trust will also include individuals from outside the Tata Group to ensure robust governance and compliance.
Trust contributions
Tata Trusts likely to contribute to the fund
Tata Trusts is also likely to contribute to the fund. The board meeting was attended by Tata Trust nominees Noel Tata, Venu Srinivasan, and Vijay Singh. There are significant legal complexities related to claims from the crash. Balaji is overseeing the framework and implementation of the trusts to ensure they remain compliant, transparent, and sensitive to the specific legal and cultural contexts of the affected families.
Financial assistance
Approach echoes Tata Group's response to 26/11 attacks
The trust will be structured to provide sustained financial support to immediate family members, covering essentials such as children's education, healthcare, and daily living expenses. This goes beyond a one-time ex gratia payment. The approach echoes the Tata Group's response to the 26/11 Mumbai terror attacks in 2008. At that time, a trust was set up to offer long-term financial and emotional support to employees and their families of the Taj Mahal Palace Hotel.