Mumbai: The government's proposals for India's aircraft maintenance, repair and overhaul (MRO) centres will 'significantly' decrease the cost difference between fixing a plane here and doing it abroad, said industry experts. They, however, said that other components, especially royalty to airports for operating MRO facilities, should be abolished for the segment to be viable.
Post the incentives, servicing a plane in an Indian MRO will be about 20% costlier than in other markets, said industry experts. It's more than 35-50% costlier now, according to industry figures. In its draft aviation policy, the ministry of civil aviation has proposed that no service tax be levied on MRO services will be zero-rated and that airport royalty and other levies will be rationalised.
Aircraft maintenance tools and tool kits will be exempt from customs duty. The government has also proposed to allow a 3-year tax holiday on storage of spare parts imported by an MRO, extended from 1 year. Also, foreign aircraft can be brought to India for MRO work and can stay here for 6 months without any regulatory approval.
31/10/15 Anirban Chowdhury/Economic Times
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Post the incentives, servicing a plane in an Indian MRO will be about 20% costlier than in other markets, said industry experts. It's more than 35-50% costlier now, according to industry figures. In its draft aviation policy, the ministry of civil aviation has proposed that no service tax be levied on MRO services will be zero-rated and that airport royalty and other levies will be rationalised.
Aircraft maintenance tools and tool kits will be exempt from customs duty. The government has also proposed to allow a 3-year tax holiday on storage of spare parts imported by an MRO, extended from 1 year. Also, foreign aircraft can be brought to India for MRO work and can stay here for 6 months without any regulatory approval.
31/10/15 Anirban Chowdhury/Economic Times
