US carriers seek to block financing of Air India jet purchases

17 Nov 2011

1

Washington: After filing objections to an impending deal to provide loan guarantees to national carrier Air India with the US Export Import Bank, American airlines escalated matters further by seeking a court injunction to stop the $3.4 billion taxpayer-backed financing of the purchase of Boeing jetliners by the Indian carrier.

The Air Transport Association, a leading US trade group for major carriers, has sought an injunction in US District Court for the District of Columbia to prevent the Export-Import Bank of the United States from financing the move.

It is the charter of the Ex-Im bank, an independent agency, to finance sales of American exports to international purchasers.

It is the contention of US airlines that low-interest credit assistance to foreign carriers violates federal law and that such financing puts them at a competitive disadvantage.

They also point out that Air India's losses and management troubles should disqualify it from financing.

It is also their contention that foreign carriers have added capacity and gained market share on international routes to and from the United States at the expense of US            carriers.

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