A federal bank that backed a huge airplane loan for Air India will have to explain that the loan didn't hurt U.S. airlines.

A lawsuit by Delta Air Lines Inc. had accused the Export-Import Bank of failing to follow a requirement that it makes sure its loans to foreign companies won't hurt U.S. competitors. The Ex-Im bank guaranteed $3.4 billion in loans in 2011 so that Air India could buy planes from Boeing Co. But Delta competes with Air India on some routes.

The Court of Appeals in Washington did not force the bank to reverse the loan guarantee, as Delta had asked. But the ruling says the bank needs to follow the law and provide more justification for the loan.