Air India has Completed the Purchase of its First A350 Aircraft via GIFT City

Air India said on Friday that it has finalized the acquisition of its first A350-900 aircraft via a financing lease arrangement with HSBC through GIFT City.

“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 wide body aircraft financing, playing a pivotal role in the future aircraft financing strategy for us and our subsidiaries,” Air India’s Chief Commercial & Transformation Officer Nipun Aggarwal said.

This is also the country’s first wide-body aircraft leased via GIFT City, the country’s first International Financial Services Centre (IFSC).

According to a press statement, the transaction was enabled by the airline’s wholly-owned subsidiary AI Fleet Services Ltd (AIFS) and is also the first finance transaction from the 470 aircraft orders placed earlier this year.

The airline has successfully bought India’s first Airbus A350-900 aircraft via a financing lease arrangement with HSBC, according to the statement.

The first A350-900 aircraft will arrive in India by the end of this year, according to Tata Group-owned Air India, which has begun an ambitious restructuring strategy.

Dipesh Shah, Executive Director of the International Financial Services Centres Authority (IFSCA), said that the IFSCA has been working with partners to build 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,” he added.

The airline has bought six A350-900 aircraft, with five of them planned for delivery by March 2024. Aside from these, the airline has definite orders for 470 new aircraft, including 34 A350-1000s, 20 Boeing 787 Dreamliners, 10 Boeing 777Xs, 140 A320 neos, 70 A321 neos, and 190 Boeing 737MAXs.

In June of this year, Air India entered purchase agreements with Airbus and Boeing to buy these planes.

Air India currently operates 116 planes, including 49 wide-body aircraft. There are 27 B787-8s, 14 B777-300s, 8 B777-200LRs, 14 A319s, 36 A320 neos, 13 A321 ceos, and 4 A321 neos in total.

Meanwhile, Tata Group is combining its airline operations, as part of which AIX Connect will combine with Air India Express and Vistara will unite with Air India. Vistara is a joint venture between Tatas and Singapore Airlines, which owns 49% of the company.