India’s MRO tax cut starts converting fleet growth into domestic capability

India has been the clearest case of fleet growth outrunning maintenance capability — record orders, rising utilisation, and heavy checks flown abroad. That is now shifting, driven less by industrial policy than by tax: cutting GST on MRO services from 18% to 5% changed the arithmetic for domestic providers competing against Gulf and Southeast Asian shops.

The capacity response is visible. A USD 500 million widebody facility is under development near Delhi, and IndiGo plans twelve additional bays at Bangalore, aiming to roughly triple its simultaneous MRO capacity. With a fleet around 350 aircraft expected to exceed 500 by 2027, the internal demand alone justifies it.

Analysts put Indian MRO growth near 7.9% annually — the fastest in Asia-Pacific, though China still holds roughly a third of regional market value. Engine work remains the constraint: it dominates spend, and GTF shop visits have absorbed capacity across the region.

Our read: airframe capability is arriving; engine and component work is the real test. Watch which approvals are filed, not which hangars open.