Our Bureau

New Delhi, Nov. 22

PRIVATE low cost carrier Indigo Airlines on Tuesday said it might launch operations by February next year by taking aircraft on lease.

"The induction of aircraft will start from July next year but we are exploring if we want to accelerate the launch of the airline to February by doing short-term leases of aircraft. We hope to announce the launch date in 6-8 weeks. It could be as early as February or March and no later than July next year," Mr Rahul Bhatia, Managing Director of Interglobe Enterprises Ltd, said.

The airline is being jointly promoted by Mr Rakesh Gangwal and Interglobe Enterprises.

Mr Bhatia said the airline plans to keep its fares at least 40 per cent lower than full service carriers. "We will compete with Air Deccan," he added.

Commenting on the state of preparedness of the airline, Mr Bhatia said it had already received the no-objection certificate from the authorities, an in-principle approval to import 100 Airbus aircraft and the airline's security manual had also been cleared.

Earlier this year, during the Paris Airshow Indigo announced a decision to induct 100 A-320 family aircraft including A-319 and 321. The aircraft would be inducted in a phased manner. "During 2006 we will import 6 aircraft, and the following year we plan to induct another 9 aircraft. In 2008 we will import 8 aircraft and after that it will be one every five weeks till 2016," he pointed out.

"It will fly in all those places where it makes economic sense to place aircraft," he said, when asked about the sectors on which the airline would operate.

He said that capital outlay would initially be pegged at $80 million as equity and scale to $250 million by 2008.

On aircraft financing, he said that generally 85 per cent of the cost of the acquisition is financed through debt or loans from financial institutions while the balance 15 per cent comes as equity from operators. "I don't think finance will be a problem, we are already talking to various financers," he added.

(This article was published in the Business Line print edition dated November 23, 2005)
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