Zet AI‑inzichten om in gerichte actie
Trending
Categories
India accelerates aircraft MRO push with tax reforms, policy support and Safran investment

India Accelerates Aircraft MRO Development Through Policy Reforms and Strategic Investments
The Indian government has announced significant strides toward establishing the country as a global hub for aircraft Maintenance, Repair, and Overhaul (MRO). In a written response to the Lok Sabha on Thursday, Civil Aviation Minister Kinjarapu Rammohan Naidu outlined a comprehensive framework of policy, taxation, and infrastructure reforms designed to foster a competitive domestic MRO ecosystem while curbing foreign exchange outflows.
Policy and Taxation Reforms to Boost Domestic MRO Industry
The government introduced new MRO guidelines on September 1, 2021, which eliminated royalties and enhanced transparency and certainty in land allotments for MRO facilities at Airports Authority of India (AAI) airports. These revised guidelines also permit the extension of land lease agreements for MRO operators by an additional 15 years beyond the initial 15-year lease period, providing greater stability for long-term investments.
On the taxation front, the Integrated Goods and Services Tax (IGST) on imports of aircraft components and engine parts has been reduced to 5 percent, a move aimed at improving the competitiveness of India’s aerospace sector. Additionally, the Goods and Services Tax (GST) on MRO services has been lowered from 18 percent to 5 percent, with full Input Tax Credit (ITC) available. Transactions subcontracted by foreign Original Equipment Manufacturers (OEMs) and MRO companies to domestic firms are treated as exports and thus attract zero-rated GST.
Further fiscal incentives were introduced in the Union Budget 2024-25, extending the permissible period for exporting goods imported for repairs from six months to one year. The timeframe for re-importing goods sent abroad for repairs under warranty was also increased from three years to five years. An Addendum to the MRO Guidelines 2026, issued on February 20, 2026, provides a moratorium and rent-free period for MRO operators constructing new hangars at AAI airports, encouraging investment in capital-intensive infrastructure.
Infrastructure Investments and Private Sector Participation
The Union Budget 2026-27 extended the exemption from Basic Customs Duty (BCD) on aircraft components, including engines used in manufacturing and repair, until March 31, 2028. This exemption also covers parts, testing equipment, tools, and toolkits essential for aircraft MRO activities, further reducing operational costs.
Highlighting private sector engagement, Minister Naidu informed Parliament of Safran’s establishment of Safran Aircraft Engine Services India (SAESI) in Hyderabad. With an initial investment of Rs 1,300 crore, SAESI is positioned as one of the world’s largest aircraft engine MRO facilities, underscoring the growing confidence of global aerospace players in India’s MRO potential.
These combined measures reflect the government’s commitment to strengthening India’s aircraft maintenance capabilities, creating a globally competitive MRO ecosystem, and positioning the country as a preferred international destination for aircraft Maintenance, Repair, and Overhaul services.

Etihad and Swissport Extend Global Partnership

Sepehran Airlines B737 Returns to Mashhad After Tyre and Engine Issues

Etihad Deploys Widebody Fleet to Meet Strong Demand

Korean Air Finalizes $36.2 Billion Deal with Boeing

Australia’s RFDS Queensland Section Orders Six King Air 260Cs

Korean Air Finalizes Order for 103 Boeing Jets and Engines

Embraer E195-E2 Features Distinctive Engine Placement Among Regional Jets

What Passengers Can Expect on Boeing’s New 777X Jet

How Ethiopian Airlines Became Africa’s Leading Carrier Amid Gulf Competition
