Aviation sector pitches to exploit the potential of aircraft MRO business

Mumbai: The aviation industry is pinning its hopes on the Narendra Modi-led government’s ‘Make in India’ campaign to better exploit the potential of aircraft maintenance, repair and overhaul (MRO) business

Representatives of the industry have written to the aviation ministry as part of pre-Budget consultations to reiterate their demand of a cut in taxes in what it believes is a $700-million (Rs 4,400-crore) a year opportunity.

Industry executives say that high taxes and royalty charged by airports make the levies in India up to 50% higher than the global average and the domestic companies manage to get slightly more than just a tenth of the potential MRO business in the country.

Several stakeholders, including the lobbying body MRO Association of India and global aircraft manufacturers, have written to the government in the past month, requesting it to slash taxes

“We have asked that service tax, which is currently 12.36%, be abolished and also that imports of spare parts for MRO work be brought under the ‘deemed exports’ category, which will give it a tax holiday,” said Pulak Sen, founder and secretary general of MRO Association of India.