Besides a huge discount on the total price of around Rs 35,000 crore (Rs 350 billion), Boeing has also offered to set up MRO (maintenance, repair, overhaul) and training facilities in India at a cost of around $205 million.
After a five-hour long meeting that eGoM and A-I officials held with Boeing representatives, Civil Aviation Minister Praful Patel said that the documents would now be sent to Prime Minister Manmohan Singh for final approval.
Patel had earlier informed Parliament that the deal would cost Rs 38,900 crore (Rs 389 billion). The eGoM, headed by Finance Minister P Chidambaram has Law Minister H R Bhardwaj and Programme Implementation Minister Oscar Fernandes and Patel as members.
Official sources said A-I has converted its options to buy 16 aircraft into a firm order, taking the total number of firm orders to 50. It is also acquiring 18 more aircraft for its subsidiary Air-India Express.
The fleet would comprise eight Boeing 777-200 (Long Range), 15 B777-300 (Extended Range) and 27 B787s, besides 18 Boeing 737-800s for Air-India Express.
The A-I Board has selected engines for all the 68 aircraft from the CFM International, a 50:50 joint venture between Snecma of France and General Electric Aviation of the US.
The two proposals were cleared by the Public Investment Board on October 13.