In a Lok Sabha reply on 30 March 2017, the Ministry of Civil Aviation said there were 110 approved MROs in India, of which only 7 could overhaul planes, so operators were taking their planes abroad for overhaul. The National Civil Aviation Policy, 2016 listed MRO among the aviation sub-sectors it sought to develop. Budget measures for 2016–17 exempted MRO tools and tool-kits from customs duty and let foreign aircraft stay in India for up to 6 months for maintenance. Aircraft components attracted GST at rates of 5%, 12%, 18% and 28%, which the Ministry said created an inverted duty structure and GST accumulation in MRO accounts.
Aircraft Maintenance (MRO)
Aircraft Maintenance (MRO)
Maintenance, repair and overhaul (MRO) covers the servicing of aircraft, engines and components. In March 2017 the Ministry of Civil Aviation said that of 110 approved MROs in India only 7 could overhaul planes, so operators sent planes abroad for overhaul. Since then GST on MRO services has been cut from 18% to 5% (April 2020), royalties at AAI airports have been abolished (September 2021) and a uniform 5% IGST on imported aircraft parts has taken effect (July 2024). According to the Ministry's Annual Report 2025, the number of MRO facilities in India rose from 96 in 2014 to 166 in 2025. This timeline traces those policy steps.
18% → 5%
GST on MRO services (from 1 Apr 2020)
100%
FDI permitted via the automatic route (as of Aug 2024)
25 years
Land allotment term for MROs at AAI airports (Jun 2023)
MRO facilities in India (2014 → 2025)
2016
Budget eases MRO customs rules
Under the 2016–17 Budget, tools and tool-kits used by MROs were exempted from customs duty, duty-free parts could be used over three years instead of one, and foreign aircraft brought in for MRO work could stay for the whole maintenance period or up to 6 months.
2017
110 approved MROs, 7 for overhaul
2020
GST on MRO services cut to 5%
2021
New MRO guidelines
2023
25-year land allotment at AAI airports
2024
Uniform 5% IGST on aircraft parts
2024
Longer windows for repair imports
2025
Safran LEAP engine MRO opens
2026
Budget 2026–27 customs exemption
2016
1milestones
20162026
Latest
Budget eases MRO customs rules
Under the 2016–17 Budget, tools and tool-kits used by MROs were exempted from customs duty, duty-free parts could be used over three years instead of one, and foreign aircraft brought in for MRO work could stay for the whole maintenance period or up to 6 months.
Why it matters Every flight depends on regular maintenance. The Ministry's Annual Report 2025 says Indian airlines began using MRO facilities within India instead of sending aircraft abroad for major maintenance, which reduced their maintenance costs. PIB says building MRO capability at home reduces foreign exchange outflows and creates high-value jobs.
- MRO facilities in India: 96 (2014) → 166 (2025)
- 110 MROs approved in India, only 7 able to overhaul planes (March 2017)
- GST on MRO services: 18% → 5% with full input tax credit (from 1 April 2020)
- MRO guidelines abolish royalties at AAI airports (1 September 2021)
- Uniform 5% IGST on imported aircraft parts, components and tools (from 15 July 2024)
- 100% FDI permitted through the automatic route for MRO (as listed by the Ministry, August 2024)
History
Notable milestone
On 15 July 2024 a uniform 5% IGST took effect on imported parts, components, testing equipment, tools and tool-kits of aircraft, whatever their customs classification, as recommended by the GST Council at its 53rd meeting on 22 June 2024. It replaced the earlier mix of rates on aircraft components. On 26 November 2025 the Prime Minister inaugurated the Safran Aircraft Engine Services India facility in Hyderabad, an MRO for LEAP engines. PIB described it as the first MRO operation set up in India by a global engine OEM.
How it works
Aircraft maintenance organisations are approved by the Directorate General of Civil Aviation under its CAR-145 rules; a February 2025 Lok Sabha reply annexed the list of DGCA-approved organisations as on 10 August 2024. GST on MRO services is 5% with full input tax credit, and work sub-contracted to Indian MROs by foreign OEMs or MROs is treated as a zero-rated export. 100% foreign direct investment is permitted through the automatic route. Under an AAI circular of 9 June 2023, land at AAI airports can be allotted to MROs at card rates for 25 years, with no royalty or concession fee. The Government facilitates MROs through policy rather than setting up facilities itself.
Outlook
The Union Budget 2024–25 extended the period for exporting goods imported for repairs from six months to one year, and the re-import window for warranty repairs from three to five years. The Union Budget of 1 February 2026 proposed exempting basic customs duty on raw materials imported to make aircraft parts for MRO by Defence-sector units. In July 2024 the Civil Aviation Minister said the Indian MRO industry was projected to become a $4 billion industry by 2030; this is a projection quoted in an official release, not a measured figure. In August 2024 he said the Government could consider a PLI scheme for MROs, depending on industry demand.
By the numbers
96 → 166 MRO facilities in India (2014 → 2025). 110 approved MROs, of which 7 could overhaul planes (Mar 2017). 18% → 5% GST on MRO services (from 1 Apr 2020). 5% uniform IGST on imported aircraft parts (from 15 Jul 2024). 25 years land allotment for MROs at AAI airports (Jun 2023). Sources: Ministry of Civil Aviation Annual Report 2025; Ministry of Civil Aviation and Ministry of Finance via PIB; Lok Sabha replies.
Data current to: MRO facilities 2014–2025; policy steps to the Union Budget of 1 February 2026
Source: Ministry of Civil Aviation and Ministry of Finance via PIB, Lok Sabha replies and the Ministry of Civil Aviation Annual Report 2025 — the timeline dates MRO policy steps from the 2016–17 Budget measures to the Union Budget of 1 February 2026; the headline, MRO facilities in India rising from 96 in 2014 to 166 in 2025, is from the Annual Report 2025 (linked). · link