IndiGo inks $2.6 billion deal with China's ICBC - Livemint

The deal comes on the day Chinese President Xi Jinping arrived in India, where the two countries are expected to sign trade and investment deals worth billions of dollars.

New Delhi: Indian and Chinese businesses on Wednesday inked agreements worth $3.43 billion, including the $2.6-billion deal between low-cost carrier IndiGo and China’s largest commercial bank ICBC.

Under pact with Indigo, Industrial and Commercial Bank of China Ltd (ICBC) will finance the no-frill airline’s plans to purchase over 30 aircraft. The announcement of MoUs, signed at a India-China business meeting organised by Federation of Indian Chambers of Commerce and Industry (FICCI), coincides with the visit of Chinese President Xi Jinping , who arrived in Ahmedabad on Wednesday on a three-day visit to India.

The Gurgaon-based carrier signed the memorandum of understanding (MoU) with the ICBC Financial Leasing Company Ltd to execute the deal.

“Through this MoU, Industrial and Commercial Bank of China Ltd (ICBC) will provide IndiGo financial solutions for the introduction of A320 and the other family of aircraft to the fleet in the form of sale and lease back or financial lease or commercial lending. “The number of aircraft would be over 30 and the value of the deal would reach to the amount of $2.6 billion,” IndiGo president Aditya Ghosh told reporters in New Delhi.

Under the MoU, ICBC will provide financing for the planes through either a sale and leaseback, financial lease or commercial lending, Indigo said in a statement.

IndiGo, one of the few profitable airlines in the country, already has a relationship with ICBC and this new effort to further explore the collaboration will cement the relationship for the longer term, the statement said.

The no-frill carrier has 81 aircraft in its fleet at present.

The other agreements inked cover a range of sectors such as aircraft leasing and financing, telecom, chemicals, wind power components, cotton yarn and fabric, synthetic fibre and seafood. They too were signed at an India-China business meeting organised by Ficci in New Delhi.

Some other agreements signed include the one between Reliance Communications and Huawei Telecommunications (India) Co. Pvt. Ltd for 2G and 3G network expansion, and a 450 MW wind power spare parts purchasing agreement between Mingyang Wind Power and Global Wind Power.