Air India has provisionally agreed to acquire almost 500 jets from Airbus and Boeing to take on domestic and international rivals.

Air India's record aircraft deal has put the Tata Group-owned airline in the league of aspiring global carriers.
On Tuesday, it provisionally agreed to acquire almost 500 jets from Airbus and Boeing to take on domestic and international rivals.

Striking the largest ever deal by one airline took months of secret talks carried out a stone's throw from Britain's Buckingham Palace and culminating in a celebration over coastal Indian curries, according to people involved in the talks.

Confidentiality was lifted on Tuesday as leaders hailed the accord in a diplomatic embrace between leading G20 nations. Tata Group, which regained control of Air India last year after decades of public ownership, put out just six paragraphs.

Its low-key announcement illustrates a rising breed of private airline owners transforming a financially-risky Indian airline sector, alongside the publicity-shy founders of IndiGo.

The deal was in the making for over a year, insiders said, recounting details of the process on condition of anonymity.

Serious talks began last summer and continued until days before Christmas when outlines were agreed. As the astonishing scale of the deal began to crystallise, Reuters reported in December the parties were nearing a record 500-plane agreement.

The epicentre of dealmaking was St James' Court - a luxury Victorian hotel near Buckingham Palace in London's West End.

In the hothouse atmosphere of a classic aircraft industry negotiating ritual known as a "bake-off", negotiators from the airline, planemakers and engine giants camped out at the Tata-owned hotel and neighbouring suites for days at a stretch.

They were chasing a bigger slice of a fast-growing market that has seen many airline growth plans rise and fall.

Now, Boeing had a chance to restore its position in India's single-aisle jet market and narrow Airbus' large lead. Airbus wanted a bigger piece of the wide-body market led by its rival. With bulging order books, neither could sweep the whole order.

At stake was India's bid to win back the custom of visitors and its own diaspora from highly efficient Gulf carriers. Politics set the context but talks were commercial - and tough.

Source - NDTV