Image Source: The Economic Times
India’s aviation sector is soaring to new heights as Gujarat International Finance Tec-City (GIFT City) unlocks a $5 billion annual opportunity through its emerging role as a global aircraft leasing hub. This development is set to transform the landscape for Indian airlines, lessors, and the broader economy.
Key Highlights
GIFT City, established as a special economic zone in Gandhinagar, offers significant tax benefits and regulatory exemptions for aircraft leasing, making it an attractive destination for global and domestic lessors.
With nearly 80 percent of India’s commercial aircraft fleet currently on lease, the new ecosystem at GIFT City is expected to reduce leasing costs by up to 15 percent, directly benefiting airlines and passengers.
The city’s International Financial Services Centre (IFSC) allows lessors to operate without prior approval for importing or leasing aircraft, streamlining the process and reducing bureaucratic hurdles.
Over 200 aircraft have already been leased through GIFT City, and major Indian carriers like IndiGo are expanding their financing operations within the hub.
The government’s recent legislative push, including the Protection of Interests in Aircraft Objects Bill, provides legal clarity and faster dispute resolution, boosting confidence among global lessors.
The initiative is expected to retain capital within India, reduce foreign exchange outflows, and foster a robust domestic aviation financing ecosystem.
Sectoral Impact
Airlines can now access more competitive leasing rates, supporting fleet expansion and improved operational efficiency.
The move is anticipated to catalyze further growth in India’s aviation market, which is already the world’s third largest and rapidly expanding.
GIFT City’s rise as a leasing hub positions India alongside global leaders like Ireland, Singapore, and Dubai, while supporting the government’s vision of self-reliance in aviation.
Sources: Economic Times, Rediff Money, PTI, Business Traveller, Maritime Gateway, NDTV Profit, FICCI, PIB
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