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How India's push for domestic aircraft maintenance finally took off

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Raghav Mahobe

18 reads
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Raghav Mahobe

18 reads

India’s air carriers depend on facilities in other countries for the most critical and high-value of their repair and maintenance needs. With the country set to emerge as the third largest aviation market worldwide in the next two years, however, self-reliance is the order of the day.

March 11, 2024

11 MINS READ

Key Takeaways

  • The Tata Group recently announced an investment of Rs 1,300 crore to build a maintenance, repair, and overhaul (MRO) facility for aircraft
  • This is the most recent in a slew of developments in the space, with domestic MRO services largely limited to more low-margin tasks
  • While 80-90% of MRO services for Indian planes are currently being done overseas, moves like Tata Group’s seek to add an element of self-reliance to India’s aviation sector
  • Indeed, with India emerging as one of the largest aviation markets globally, India’s MRO sector is expected to double in value to $4bn by 2031

For a country that is the fastest-growing aviation market in the world and is already the third largest domestic market globally, India’s aviation sector has a scarcely believable Achille’s heel. For all meaningful maintenance on India’s burgeoning fleet of commercial aircraft, they need to be sent overseas. In fact, 80-90% of these services are being done in markets such as Singapore and the United Arab Emirates (UAE), say experts.

Take market leader IndiGo, for instance. Last year, its airline engineering head SC Gupta told the Ministry of Civil Aviation, or MoCA, that 90% of the firm’s expenditure on aeroplane maintenance, repair, and overhaul—known commonly in the industry as MRO—went to foreign firms. IndiGo alone, he said, allocates some $300 million towards MRO annually, meaning some $270 million flows out of the country.

Incredibly, this is despite IndiGo being one of the few domestic airlines with MRO facilities of its own. With domestic airlines set to add hundreds of planes to their fleets in the coming years, however, the aviation sector is finally gearing up to address this glaring weak spot.

On February 19, Air India owner Tata Group signed a memorandum of understanding (MoU) with the Karnataka government to set up an MRO facility in Bengaluru with an investment of Rs 1,300 crore.

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