Business Today
Loading...

Two Boeing wide-body planes for Modi, Kovind, Naidu to cost Rs 8,458 crore

Aircraft are part of Air India's 2006 order of 68 aircraft given to US-based aircraft maker Boeing; once inducted, these aircraft will be used exclusively for travel of VVIPs unlike now when Boeing 747s are used for more than just 'VVIP travel'

twitter-logo Manu Kaushik   New Delhi     Last Updated: February 3, 2020  | 22:06 IST
Two Boeing wide-body planes for Modi, Kovind, Naidu to cost Rs 8,458 crore
While the deal was struck in 2006, it's unlikely that the prices negotiated at that time will be applicable on deliveries scheduled this year

In the recent Budget speech by Finance Minister Nirmala Sitharaman, a total of Rs 810.23 crore was allocated for the purchase of two new aircraft for Special Extra Section Flight (SESF) operations. This provision is on top of an estimated Rs 4,741.85 crore allocated by the government over the past two years -- 2018/19 and 2019/20. The two aircraft (Boeing 777-300ER), which would replace the nearly 25-year-old Boeing 747 used by Air India to ferry President Ram Nath Kovind, Vice-President Venkaiah Naidu and Prime Minister Narendra Modi, are likely to be inducted by July.

These aircraft will go with Air India One sign. Air India One (also referred to as AI-1 or AIC001) is the call sign of any aircraft with the President or Prime Minister of India on board.

The aircraft are reportedly part of Air India's 2006 order of 68 aircraft given to US-based aircraft maker Boeing. Once they are inducted, these aircraft will be reportedly used exclusively for the travel of VVIPs unlike now when the Boeing 747s are used for more than just 'VVIP travel'.

Thus far, the national carrier has denied sharing the cost of these aircraft but a back-of-the-envelope calculation show they are going to cost about $1.18 billion (over Rs 8,458 crore at the current exchange rate) to the exchequer.

Also read: Air India sale: Debt burden on buyer to be Rs 23,286 crore

How? There are four key components of these special aircraft: the engines, cabin configuration, missile defence system, and the aircraft themselves.

While the deal for the aircraft was reportedly struck in 2006, it's unlikely that the prices negotiated at that time will be applicable on the deliveries scheduled this year.

As per Boeing, the current list price of Boeing 777-300ER (ER stands for extended range) is $375.5 million. The list price of this aircraft has gone up substantially since the 2006 deal. For instance, between 2014 and 2020, the list price has moved up $55.3 million apiece. Of course, these are "rack-rates" and the actual price will be different -- depending on the negotiations between Boeing and Air India (or in this case, the government of India).

The second big element of the aircraft is the missile defence system - Large Aircraft Infrared Countermeasures (LAIRCAM) and Self-Protection Suites (SPS) - which is expected to cost $190 million, as per some reports that appeared last year when the deal for these systems were signed between US and India.

Also read: Air India sale: Deal terms look 'sweet' but is govt misleading buyers?

The advanced system will make the aircraft of Indian VVIPs as safe as Air Force One (Boeing 747-200B) used by US President Donald Trump. It's because of these missile defence system that the aircraft will be operated by IAF (Indian Air Force) as they only have the capabilities to operate such systems.

Air India has been training IAF pilots to operate the long-haul aircraft since the national carrier has pilots with type-rated training to fly Boeing 777. Air India has been operating them for several years now; the first such aircraft was inducted in its fleet way back in 2007.

Also Read: Air India sale: Here are the main conditions set by Modi govt

In his reply in the Lok Sabha, the former junior aviation minister Jayant Sinha had said that the cost of cabin reconfiguration was estimated at $132 million in 2018 for both the aircraft as against the initial estimates of $180 million.

The last cost component is engines. Since it's a twin-engine plane, four GE90-115BL engines have to be bought. However, it's highly likely that the government will keep some spare engines to minimise downtime during overhaul and maintenance. The total cost of these engines is expected to be $110 million (at 2011 prices) -- if not more.

The government has allocated Rs 5,552.08 crore for these aircraft so far, which essentially means it will have to earmark over Rs 2,900 crore more in the years to come. As Boeing, which is customising the aircraft at its Dallas facility, gets ready for delivery by the middle of the year, it's time to know how much they are going to set us back by.

Also Read: Govt to sell 100% stake in Air India; issues bid document

Youtube
  • Print

  • COMMENT
BT-Story-Page-B.gif
A    A   A
close