Daily News Analysis

Push for the MRO Industry in India

stylish_lining

The Indian government is taking significant steps to enhance the Maintenance, Repair, and Overhaul (MRO) industry, particularly in the aviation sector. Recent policy changes aim to boost competitiveness, foster innovation, and establish a robust framework for MRO services in the country.

Key Policy Changes

  • Uniform 5% IGST Rate:
  • The government has introduced a uniform Integrated Goods and Services Tax (IGST) rate of 5% on imports of aircraft parts, components, testing equipment, tools, and toolkits, regardless of their HSN classification. This simplifies taxation and reduces costs for MRO service providers.
  • Extended Timeframes for Repairs:
  • In the Union Budget 2024-25, the period for exporting goods imported for repairs has been extended from 6 months to 1 year.
  • The timeframe for re-importing goods exported under warranty for repairs has been increased from 3 to 5 years.
  • New MRO Guidelines:
  • Announced in 2021, these guidelines have abolished royalties and introduced transparency in land allotments at Airports Authority of India (AAI) airports, facilitating easier establishment of MRO facilities.
  • Reduced GST:
  • The GST rate on MRO services has been reduced from 18% to 5%, with full Input Tax Credit available since 2020, making it more attractive for domestic and foreign players.
  • Zero-rated GST for Subcontracted Transactions:
  • Transactions subcontracted by foreign Original Equipment Manufacturers (OEMs) to domestic MROs are treated as 'exports' and are eligible for zero-rated GST, promoting domestic MRO capabilities.
  • Customs Duty Exemptions:
  • Customs duty on tools and toolkits has been exempted, which aids in reducing operational costs for MRO services.
  • Simplified Clearance Processing:
  • The clearance processing for parts has been simplified, streamlining operations and improving efficiency.
  • 100% FDI Permitted:
  • The sector allows 100% Foreign Direct Investment (FDI) through the automatic route, encouraging international players to invest in the Indian MRO landscape.

Impact and Future Prospects

These comprehensive measures are expected to significantly enhance the competitiveness of the Indian MRO industry, attracting investments and fostering growth. By creating a conducive environment for innovation and efficiency, the government aims to position India as a global hub for MRO services, reducing dependency on foreign facilities and supporting the growth of the aviation sector.

Conclusion

The government's proactive approach to reforming the MRO industry through targeted policy changes is set to strengthen the aviation sector in India. By reducing costs, simplifying regulations, and encouraging investment, India is on track to becoming a leading player in the global MRO market.

Israel-US-Iran Conflict

Recently, tensions in the Middle East escalated dramatically as Israel launched “Operation Rising Lion”, a significant military strike aimed at Iranian nuclear infrastructure and balli
Share It

Philippines President’s Visit to India (2025)

In 2025, during the Philippines President's state visit to India, both nations elevated their bilateral relationship to a Strategic Partnership. The visit reaffirmed the 1952 Treaty of Friends
Share It

India's Participation in the 51st G7 Summit

India participated as an Outreach Country in the 51st G7 Summit held in Kananaskis, Canada in 2025. Key Outcomes of the 51st G7 Summit (2025): Kananaskis Wildfire Charter:
Share It

Quit India Movement (QIM)

India commemorates 8th August every year as Quit India Movement Day (also known as August Kranti Diwas) to honor the historic movement that demanded the immediate end of British colonial rule in I
Share It

Union Cabinet Approves National Sports Policy (NSP) 2025

The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the National Sports Policy (NSP) 2025, aiming to address long-standing challenges and transform India into a global sportin
Share It

CIMMYT’s Financial Crisis

The International Maize and Wheat Improvement Center (CIMMYT), a pivotal institution in the development of agricultural research for maize, wheat, and related crops, is facing significant financia
Share It

Shanghai Cooperation Organisation (SCO)

India's refusal to sign the joint declaration at the Shanghai Cooperation Organisation (SCO) Defence Ministers' meeting in Qingdao, China has been a significant diplomatic development.
Share It

China-Pakistan-Bangladesh Trilateral Meeting

China, Pakistan, and Bangladesh held their first-ever trilateral meeting during the 6th China-South Asia Cooperation Forum.China took the lead in facilitating the dialogue, aiming to boost regiona
Share It

US Imposing Tariffs on India

The US's decision to raise tariffs on India, particularly targeting the continued purchase of Russian oil, has had significant implications for the bilateral trade relationship between the two
Share It

Offshore Wind Energy

As India expands its wind energy capacity, reaching an estimated 51.3 GW by mid-2025, concerns are growing over the environmental impact, particularly on bird populations and marine biodiversity.
Share It

Newsletter Subscription


ACQ IAS
ACQ IAS