Union Minister for Civil Aviation, Rammohan Naidu, reaffirmed the government’s dedication to developing a strong infrastructure for Maintenance, Repair, and Overhaul (MRO) services in India, catering to both domestic and international airlines. During his speech in the Lok Sabha, Naidu discussed the challenges the MRO sector faces and emphasized that the government’s efforts are geared towards not only supporting Indian airlines but also attracting global carriers to utilize India’s MRO facilities. Strategic locations such as Thiruvananthapuram were highlighted as key areas for this expansion. He also noted the recent unification of GST slabs for MRO components and services, which is anticipated to integrate domestic MROs into international value chains more effectively. With Indian airlines ordering over 1,100 new aircraft, the MRO industry in India is expected to grow significantly, potentially doubling from $2 billion to $4 billion in the next seven years.
Naidu outlined several initiatives from the Ministry of Civil Aviation aimed at bolstering the MRO sector, including the potential extension of the Production Linked Incentive (PLI) scheme. This scheme could further stimulate growth within the industry. He described the recent GST reform, which introduced a uniform IGST rate of 5% for all aircraft parts and components, as a “historic decision” designed to simplify taxation and support the sector’s growth towards a $4 billion valuation by 2031. Additionally, the Minister highlighted the government’s support for establishing MRO facilities across India, offering policy and regulatory support. Measures such as extending the export period for goods imported for repairs, exempting customs duties on tools, and permitting 100% Foreign Direct Investment (FDI) via the Automatic Route for MROs are expected to boost the sector’s efficiency and enhance its global competitiveness.
