Daijiworld Media Network - New Delhi
New Delhi, Oct 13: IndiGo, India's largest airline, has signed a $328 million financing agreement with global banking major Citi to acquire eight narrow-body aircraft from Airbus, marking the world's first aviation financing transaction insured by Belgian export credit agency Credendo.
The transaction is also the first export credit agency (ECA)-backed aircraft financing deal structured through the Gujarat International Finance Tec-City's International Financial Services Centre (GIFT IFSC), according to a statement.
The financing will support IndiGo's acquisition of six Airbus A321 aircraft and two A320 aircraft. Citi acted as the sole mandated arranger, ECA coordinator and lender, with the financing backed by Credendo's credit insurance.
The deal was executed through IndiGo's subsidiary, InterGlobe Aviation Financial Services IFSC, providing the airline with a competitive and diversified source of long-term funding to support its fleet expansion and network growth.
Citi India's chief executive K Balasubramanian said the transaction combined Citi's cross-border aviation and export credit financing expertise with Credendo's credit insurance and IndiGo's GIFT IFSC platform to create a new financing avenue for Indian aviation.
He said the arrangement would connect the sector with international funding backed by export credit agencies and support the next phase of India's aviation growth.
Credendo group deputy CEO Frank Vanwingh said the agency aimed to become a long-term partner for Belgian aviation stakeholders seeking international opportunities and innovative financing structures.
IndiGo's chief aircraft acquisition and financing officer Riyaz Peermohamed said the partnership with Citi, Credendo and Airbus would provide a competitive source of liquidity for the airline's growing Airbus fleet. He added that the transaction demonstrated GIFT IFSC's potential to bring international banks and export credit agencies together to develop innovative financing solutions for Indian aviation.
In 2023, IndiGo announced an order for 500 narrow-body aircraft from Airbus' A320 family. The airline has also committed to adding the wide-body Airbus A350 to its fleet as it expands its operations.