PARIS, France (AFP) — Indian airline IndiGo has confirmed an order for 250 A320neo planes, Airbus announced Monday, the aviation giant’s largest ever contract by number.

The order is worth some US$26.5 billion at catalogue prices, and brings to 530 the number of A320 and A320neo medium-haul planes owned by the low-cost operator.

The purchase of the single-aisle A320neo planes confirms a draft deal signed in October.

“This new order further reaffirms IndiGo’s commitment to the long-term development of affordable air transportation in India and overseas,” IndiGo President Aditya Ghosh said in a statement.

For decades, Indians depended on the nation’s bone-jolting railways to travel, but cheap air fares have encouraged tens of millions of increasingly affluent Indians to fly.

International tourism in the region is also booming.

IndiGo, India’s largest passenger carrier, is the sole airline operating in the country to report profits consistently thanks to zealous cost controls — even with India’s high fuel taxes, ramshackle airport infrastructure and vicious fare fights.

It marks Indigo’s bet that air travel is only just taking off in the country of 1.25 billion people, analysts say.

The order is also part of Indigo’s drive to keep its fleet young — it retires its aircraft after six years — to minimise maintenance and fuel costs.

Smaller passenger planes are increasingly in demand around Asia as budget carriers expand their reach to smaller cities.

And unlike Airbus’s traditional A320 plane, the “neo” aircraft is designed to consume 15 per cent less fuel, a significant selling point for airlines in the cut-throat medium-haul sector.

It boasts aerodynamic improvements, trimmed weight and more efficient engines.