Standard Chartered Bank and Bank of India have confirmed the financing of a USD215 million loan to AI Fleet Services IFCS Limited (AIFS), the leasing subsidiary of Air India (AI, Delhi International).

In a statement, the companies said the seven-year amortising term loan will support the carrier’s ongoing fleet renewal and expansion programme. Air India, part of the Tata Group, has embarked on a five-year transformation plan that includes orders for 570 new aircraft.

The financing was first reported by Bloomberg earlier this month. The funds will be used to refinance debts on six B777-300ERs that Air India acquired from lessor Altavair earlier this year. In July, ch-aviation reported that the carrier was seeking a USD200 million loan for the purchase.

The loan is the first commercial aircraft finance transaction to be structured through GIFT City (Gujarat International Finance Tec-City), India's first international financial services centre, located between the cities of Gandhinagar and Ahmedabad. Executives from both banks said the deal reflects growing investor confidence in India’s aviation finance system.