GANDHINAGAR- On Friday (September 29, 2023), Air India (AI) announced the successful completion of the acquisition of its inaugural Airbus A350 aircraft, facilitated through a finance lease transaction conducted via HSBC and the GIFT City.
This marks the first wide-body aircraft acquired through GIFT City, India’s premier International Financial Services Centre (IFSC).
Air India A350 Leasing
The transaction was orchestrated with the assistance of Air India’s wholly-owned subsidiary, AI Fleet Services Ltd (AIFS), and represents the inaugural financing arrangement stemming from the extensive order for 470 aircraft placed earlier this year.
As part of its ambitious transformation strategy, Air India, now owned by the Tata Group, anticipates the arrival of its first A350-900 aircraft in India by the conclusion of this year.
The release further emphasizes that Air India has achieved a significant milestone by securing India’s premier Airbus A350-900 aircraft through a finance lease arrangement with HSBC.
“This significant transaction represents the commencement of our aircraft leasing operations within GIFT IFSC, with AIFS assuming a central role in wide-body aircraft financing for the Air India Group. AIFS will play a pivotal role in shaping our future aircraft financing strategy and that of our subsidiary companies,” stated Nipun Aggarwal, Chief Commercial and Transformation Officer at Air India.
Dipesh Shah, Executive Director of the International Financial Services Centres Authority (IFSCA), emphasized their collaborative efforts with stakeholders to establish regulatory frameworks conducive to aircraft leasing and financing.
He further highlighted the importance of Air India’s establishment of a financial entity dedicated to aircraft leasing and financing within IFSC, foreseeing it as a substantial step toward positioning IFSC as a preferred global destination for aircraft leasing and financing activities in India.
Historical Order
Air India has placed orders for a total of six A350-900 aircraft, with deliveries expected for five of them by March 2024. Additionally, the airline has firm orders for 470 new aircraft, comprising 34 A350-1000s, 20 Boeing 787 Dreamliners, 10 Boeing 777Xs, 140 A320 neos, 70 A321 neos, and 190 Boeing 737MAXs, as part of agreements signed with Airbus and Boeing in June of the current year.
Currently, Air India operates a fleet of 116 aircraft, including 49 wide-body planes, consisting of 27 B787-8s, 14 B777-300s, 8 B777-200LRs, 14 A319s, 36 A320 neos, 13 A321 ceos, and 4 A321 neos.
Moreover, the Tata Group is in the process of restructuring its aviation businesses, including the merger of AIX Connect with Air India Express (IX) and the integration of Vistara (UK) with Air India.
Vistara is a collaboration between the Tata Group and Singapore Airlines, with the latter holding a 49 percent stake in the carrier.
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