Working out details to fund AI's Dreamliner buys: US Exim Bank

The US Exim Bank today said it was working out the details to finance/guarantee Air India's acquisition of 27 Dreamliners from Boeing, seven of which will be delivered from October through March.

"We are working out the details. The quantum of funds will be worked out as per the delivery schedule. I have been told that out of the total order of 27 Boeing 787s, seven are expected to be delivered by the end of this fiscal," US Exim Bank Chairman and President Fred P Hochberg told PTI on the sidelines of a meeting here.

Media reports had earlier this week said AI would raise fresh $832 million or Rs 3,745 crore loan to fund the purchase of Boeing 787 planes and will secure the US Exim Bank guarantee.

When asked whether it could be a loan or a guarantee, he merely said, "We are working out the details and that AI has been a customer for decades."

During the boom years, AI had ordered as many as 111 new planes worth Rs 55,000 crore, including 27 Boeing 787 Dreamliners, and over 60 from Airbus. But following the global financial meltdown, Boeing could not meet the delivery deadline and AI is now entitled to compensation of about $500 million as penalty.

The Indian government, on its part, is not keen to go ahead with the full order given that AI has run into financial difficulties. AI has reported over Rs 7,000 crore loss in FY11 and has an accumulated liability of over Rs 42,000 crore.

The airline is reportedly making a monthly loss of Rs 400-450 crore. And if the 27 Dreamliners are to be taken in, it will push the liability of the airline to Rs 90,000 crore.