Indian low-cost carrier (LCC) IndiGo has signed a letter of intent for up to 50 ATR 72-600 regional turboprops.

The deal is valued at more than $1.3 billion at list prices and the initial aircraft are anticipated to start operations by the end of 2017.

The order, announced May 9, gives New Delhi-based IndiGo the flexibility to cut the number of aircraft it orders in certain circumstances. The criteria for such a reduction were not explained.

IndiGo describes itself as India’s largest passenger airline with a market share of 39.9% as of March 2017. It operates primarily domestically.

The airline, which has secondary hubs at Mumbai and Kolkata, is currently solely an Airbus A320 operator. These will be its first turboprops as it readies for what it says will be an ambitious development of its regional footprint.

The carrier’s announcement coincides with the launch of the Indian Government’s Regional Connectivity Scheme (RCS) that aims to boost economic development, employment and tourism by connecting small and remote cities.

India’s rapidly expanding domestic market represented close to 100 million passengers in 2016 and has been steadily growing by more than 20% annually. At that rate, it is expected to become the world’s third largest market by 2020. Under the RCS, 100 new airports will be created within the next two to three years and airlines will receive financial support and other incentives to make air travel affordable.

“We are embarking on a journey to build a nationwide regional network and connect cities that have not benefitted from the growth in Indian aviation,” IndiGo president Aditya Ghosh said, adding, TThe ATRs’ low operating costs will help us build a large regional air travel network with reasonable fares.”

Alan Dron