The Indian aviation sector's maintenance, repair, and overhaul (MRO) segment is set to receive a significant boost from recent developments, including the government's budget proposal and Safran's investment in a new MRO facility.
The budget proposal, which extends the term for export of equipment imported for repairs from six months to a year, has been hailed by Safran as a positive step. Jeetendra Gavankar, chief executive of Safran India, stated that this move, along with earlier announcements on the goods and services tax (GST) for aircraft and engine parts and the extension of the re-import period for MRO under warranty, will provide much-needed flexibility to MRO operators.
The industry has long been hampered by the six-month time limit, especially with the current supply chain disruptions causing delays in turnaround times. The extended timeframe will allow for more efficient and timely repairs, ultimately benefiting the entire MRO ecosystem.
Further solidifying India's growing importance in the global MRO landscape, Safran, a leading aircraft engine manufacturer, is investing $150 million in a new MRO facility in Hyderabad. This facility, slated to open in 2025, will focus on the maintenance and overhaul of CFM engines, which power the majority of Airbus A320 Neo aircraft.
This investment is significant as it addresses a gap in India's MRO capabilities. While the sector has seen considerable growth, it still lacks expertise in engine overhaul and component repair services, which companies like Safran can provide.
Safran's commitment to India's MRO sector is not limited to the Hyderabad facility. The company has also established a joint venture with Hindustan Aeronautics Ltd. (HAL) in Goa to provide maintenance and repair services for engines installed in military helicopters manufactured by HAL.
Additionally, other international companies are also eyeing the Indian MRO market. Aequs, an Indian aerospace company, recently signed a memorandum of understanding with Canadian aerospace company Magellan to explore the establishment of an MRO facility for aviation engines in Belagavi, Karnataka.
These developments indicate a growing recognition of India's potential as a global MRO hub. With its large and growing aviation market, skilled workforce, and supportive government policies, India is well-positioned to attract further investment in this sector.
