NEW DELHI · MRO
India’s MRO tax cut starts converting fleet growth into domestic capability
A GST reduction from 18% to 5%, a USD 500 million widebody facility near Delhi and IndiGo’s expansion are combining to keep maintenance revenue in-country.
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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.