Air India Procures India's Inaugural Airbus A350-900 through GIFT IFSC

01 Oct, 2023

Air India Procures India's Inaugural Airbus A350-900 through GIFT IFSC

Tata-owned Air India has successfully acquired the nation's inaugural Airbus A350-900 aircraft through a financial lease arrangement with HSBC, as announced on Friday. This milestone marks Air India's first financial transaction following a significant order for 470 aircraft from both Airbus and Boeing. The purchase agreements were formally inked during the Paris Air Show held in June 2023.

The Airbus A350-900 is capable of accommodating 300-350 passengers and boasts an impressive non-stop ultra-long-range capability of up to 18,000 kilometers. The initial delivery of Air India's six Airbus A350-900 aircraft is anticipated by the end of this year, with the remaining aircraft scheduled for arrival through March 2024. In addition to these A350-900s, Air India's comprehensive order includes 34 A350-1000s, 20 Boeing 787 Dreamliners, 10 Boeing 777X widebody aircraft, along with 140 Airbus A320neos, 70 Airbus A321neos, and 190 Boeing 737MAX narrow-body aircraft.

Notably, this record-setting deal carries several significant distinctions. Air India is the first scheduled carrier to procure an aircraft through an entity registered in Gujarat International Finance Tec-City (GIFT City). Furthermore, Air India's first A350-900 represents the maiden instance of a widebody aircraft being leased through India's inaugural International Financial Services Centre (IFSC). Facilitating this transaction is AI Fleet Services (AIFS), a wholly-owned subsidiary of Air India and a finance company registered within GIFT IFSC.

Nipun Aggarwal, Chief Commercial & Transformation Officer at Air India, emphasized the historic nature of this transaction, describing it as the initiation of their aircraft leasing business from GIFT IFSC. AIFS is set to assume a central role in the aircraft financing strategy for Air India and its subsidiaries, contributing significantly to the development of a robust aviation ecosystem in India.

The Indian government's vision includes the establishment of an aircraft leasing hub within GIFT IFSC. The International Financial Services Centre Authority (IFSCA) has been actively collaborating with stakeholders to create regulatory frameworks conducive to aircraft leasing and financing. Dr. Dipesh Shah, Executive Director at IFSCA, acknowledged Air India's efforts in establishing a finance company dedicated to aircraft leasing and financing at IFSC, highlighting its potential to position IFSC as the preferred global destination for aircraft leasing and financing within India.