Announcement of Loans to Air-India International on March 5, 1957

' FOR IMMEDIATE RELEASE • 1818 H STREET, N.W., WASHINGTON 25, D. C. TELEPHONE: EXECUTIVE 3-6360 PRESS RELEASE NO. 477 SUBJECT: Loans to 'Air-India International March 5., 1957 The follmd.ng announcement by The First Boston Corporation in New York is for release at 4:00 p.m. on Tuesday, March 5: "Air-India International Corporation., India's international airline., has arranged to borrow $16.8 million to finance the dollar costs of three Boeing long-range jet passenger planes. The borrowing was a joint operlil:}:~Irwhereby five United States commercial banks granted Air-India a credit of $11.2 million • and the World Bank., under a separate agreement, lJpnt the Corporation $5 .6 million • 'rhe loans will carry the guarantee of the Government of India. UThe First Boston Corporation acted 11s agent for Air-India International in negotiating this. first direct Indian borrowing in'the New York market. / Air-India entered into a credit agreement on January 31., 19.57 with The First National City Bank of New York., the Bank of America N.T. & S.A • ., The Chase Manhattan Bank., thta Ir.ring Trust Company and The First National Bank of Boston. Borrowing under the Credit:Agreement may be takeb:::,~\9-Y Air-India from July 1, 1959 to September 30, 1961. Sinking Fund payments will begin six months after the scheduled delivery of the third aircraft in ¥iarch 1960 but in no event later than .Mar'E:h 31, 1962. Repayments will be made in seven semi- annual. payments so that the entire commercial bank loan will be retired by March 31, 1965 at the latest • • March "The loan agreement with the World, Bank was signed in Washington. on 5, 1957. The loan bears interest o:r commission charged by the Bank. St% per annum including the 1% .A.~ortizationwill be in four semi-annual. • ... • - 2 - installments beginning April 1, l96S and ending October 11 1966. This schedule will be moved forward if the commercial bank loans are repaid before March 31, 1965. "Air-India International Corporation is a government corporation. Opera- tions have grown from a weekly Bombay-London service in June 1948 to 11 services a week along routes aggregating over 22,000tmiles; from India to the United \\ Kingdom via the Middle and Near East and Europe; to Southeast Asia and Japan; to East Africa; and to Australia. Air-India now carries about two-thirds of ,the air passenger tra?N::g between India and other countries. The present fleet consists of eight Supe:r-Constallations and three Constellations. A:i'.r-India's operatio~;3J. efficiency and safety record are good. The Corporation will use the additional aircraft to meet the demands of growing traffic and is • equipping itself with jet aircraft so that it can maintain its competitive position among airlines servicing India. "Ai?,.India International. is purchasing three Boeing long-range jet airplanes (model 707-420) powered by four Rolls-Royce "Conw~" engines each, ni?;l~ \I spare engines and other spare parts, a flight simulator and ancillary equipment. The total cost will be equivalent to about $23 million, of which $22.l million is in foreign exchange. In addition to the dollar costs of $16.8 million, an a:mount of $5.J' million will be required in pounds sterling (I.1.9 million). Air-India in consultation with· the Government of India is considering the· manner in which the sterling' requirements w¥1 ',./ be financed.II .: