Air India raises ₹14,000 cr loan from SBI, BoB

Tata group-owned Air India has secured ₹14,000 crore in funding from State Bank of India and Bank of Baroda through a mix of fresh loans and refinance of existing debt, two people aware of the development said.

- Shayan Ghosh & Mihir Mishra

The fundraising comprised ₹12,500 crore to refinance existing loans and the remaining ₹1,500 crore obtained through the pandemic-era Emergency Credit Line Guarantee Scheme (ECLGS). The sovereign-backed credit scheme, first introduced to aid small businesses during the pandemic, was later extended to other covid-hit sectors.

The funds will support the airline’s efforts to expand in the upcoming expansion into both domestic and international markets with leased aircraft and new planes.

As part of the expansion plan, the airline announced plans to induct aircraft on lease starting December last year and has placed a firm order for 470 aircraft with Boeing and Airbus.

The airline’s leasing plan includes 21 Airbus A320neos, four Airbus A321neos and five Boeing B777-200LRs, which have started arriving in December. The airline has also announced a firm order of 470 aircraft, and 31 of those planes —25 brand-new Boeing B737-800s and six Airbus A350-900s—will come in the second half of 2023.