New Delhi, March 27 Civil Aviation Minister Ram Mohan Naidu on Thursday said that the government was keen on developing an aircraft leasing ecosystem in the country, and several companies have set up bases in Gujarat's GIFT City, which has already leased 200 aircraft.
Replying to supplementaries in the Lok Sabha, the minister highlighted that the government was also working on bringing down aircraft leasing costs. The minister said the government would bring in a new law to ratify the Capetown Convention which will reduce the leasing costs of aircraft by 8-10 per cent. The reduction in leasing costs would also result in more planes and lower airfares for passengers, he added.
The government has also rolled out various tax incentives for companies leasing out aircraft and the easing of DGCA rules to import such aircraft into the country.
He cited the examples of Ireland, Singapore, and Dubai as major hubs for leasing aircraft that India could follow.
The minister also highlighted the rapid growth in the Indian civil aviation sector. He said that the government was encouraging more airlines to enter the Indian civil market, and the UDAN scheme had led to even smaller airlines starting operations.
Earlier this month, Naidu attended the second India Aircraft Leasing and Financing Summit at Gandhinagar in Gujarat, organised by the Union Ministry of Civil Aviation jointly with FICCI and the International Financial Services Centre Authority (IFSCA).
Naidu said that GIFT City is comparable to any global financial centre. He emphasised that India was not trying to compete with anyone, and only complement the global centres. "The idea is that we should not miss out on the huge opportunity due to the large market which can accommodate more such players."
He said that GIFT City will give India’s aviation sector the further required confidence, commitment and collaboration to develop a competitive aircraft leasing hub.
The minister further stated that aircraft leasing is a key financial innovation that India’s growing civil aviation sector needs. Fuelled by the UDAN scheme and doubling of India’s airports in 10 years, India has become the 3rd largest domestic aviation market in the world, he emphasised.
The Minister also stated that by 2047, the Government is planning to build 350 airports, out of which 34 will function as mega airports handling two crore passengers annually. "In the next five years, we are planning to build 50 more airports," he said.
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