Airport Authority Offers Land At Eight Airports To Set Up Maintenance, Repair & Overhaul Facility; Invites Bids

Union civil aviation minister Hardeep Singh Puri informed the Rajya Sabha on Wednesday(24 March) that the Airport Authority of India, AAI, has marked lands at eight airports for inviting bids to set up, Maintenance Repair and Overhaul, MRO units reports LIvemint.

These airports include Begumpet, Bhopal, Chandigarh, Chennai, Juhu, Kolkata, New Delhi, and Tirupati.

“The Airports Authority of India (AAI) has come up with a liberal Maintenance, Repair and Overhaul (MRO) policy with significantly reduced liberalized land rentals," Puri said, adding that no revenue share will be charged from MROs by AAI under the new contracts.

Puri added that MROs currently operate out of 19 airports run by AAI, including airports at Hyderabad and Mumbai, which are run under the PPP (public-private partnership) model.

To encourage the MROs facilities in India, the government has taken several measures, including reducing Goods and Services Tax (GST) on MROs from 18 per cent to 5 per cent with full Input Tax Credit, treating transactions sub-contracted by foreign OEMs (Original Equipment Manufacturers) and MRO companies to domestic MRO as exports with zero-rated GST, both effective from 1 April 2020. 100 per cent FDI through automatic route is also allowed.

According to a report published in India Infrahub, India spends around $1.4 billion on MRO providers overseas.

This cost can be cut significantly with the boost to the MRO facility available in the country.

According to the 291st report tabled in parliament on 17 March by the parliamentary committee on transport on Demands and Grants(2021-22) of Ministry of Civil aviation, the ministry has stated the following points;[for time required for MRO in India]

Airbus has signed a Memorandum of Understanding (MoU) with GMR Group to explore collaboration opportunities across aviation services, technologies and innovation.

Hindustan Aeronautics Limited (HAL) has signed MoU with Air India Engineering Services Limited (AIESL) for carrying out MRO activities for civil aircraft and defence aircraft as a part of civil-defence convergence in MRO.

New investment is seen in hangar-based maintenance facilities at Kochi and Hyderabad airports (02 hangars each) to commence operations by Feb-March 2021. This includes the first set of two inflatable hangers, which Indian MRO has contracted, thus swiftly adding to the airframe MRO capacity.

SAFRAN(a French MNC, in aerospace-defence components) is expected to start engine repairs in India by 2022.