Air India acquires country’s first Airbus A350-900 via GIFT IFSC

• The first of Air India’s six Airbus A350-900 is expected to arrive in India by the end of the year.
• A350-900 can accommodate 300-350 passengers, and fly 18,000 kilometers non-stop.
• Air India is the first to have acquired an aircraft from an entity registered in GIFT City.
  

Tata-owned Air India has acquired the country’s first Airbus A350-900 via aircraft through a finance lease transaction with HSBC, it said on Friday. This is Air India’s first financing transaction, after it signed a mega order deal to acquire 470 aircrafts from Airbus and Boeing.

The purchase agreements were signed on the sidelines of the Paris Air Show held in June 2023.

The A350-900 can accommodate 300-350 passengers. It can fly on ultra-long-range routes of up to 18,000 kilometers non-stop. The first of Air India’s six Airbus A350-900 is expected to arrive in India by the end of this year.

The remaining aircraft are scheduled for deliveries through March 2024. In addition to the six Airbus A350-900 aircraft, Air India’s 470 deal includes 34 A350-1000, 20 Boeing 787 Dreamliners, 10 Boeing 777X widebody aircraft, as well as 140 Airbus A320neo, 70 Airbus A321neo and 190 Boeing 737MAX narrow body aircraft.

The record-setting deal also has many other firsts to its name. Air India is the first scheduled carrier to have acquired an aircraft from an entity registered in Gujarat International Finance Tec-City (GIFT City). Its first A350-900 is also the first widebody aircraft to have been leased through India’s first International Financial Services Centre (IFSC).

The transaction was facilitated by AI Fleet Services (AIFS), a 100% subsidiary of Air India, and a GIFT IFSC-registered finance company.

“This landmark transaction marks the beginning of our aircraft leasing business from GIFT IFSC, as AIFS will be the primary Air India Group entity for widebody aircraft financing, playing a pivotal role in the future aircraft financing strategy for us and our subsidiaries. It is also a shot in the arm for the development of a robust aviation ecosystem in India,” said Nipun Aggarwal, chief commercial & transformation officer, Air India.

The Government of India intends to develop an aircraft leasing hub in GIFT IFSC. IFSCA has been working with the stakeholders to develop regulatory enablers for aircraft leasing and financing.

“The steps taken by Air India by establishing a finance company for the purpose of aircraft leasing and financing at IFSC will go a long way in developing IFSC as a preferred destination for aircraft leasing and financing in India as well as globally," mentioned Dr Dipesh Shah, executive director, IFSCA.