Air India’s Nagpur MRO Facility Set to Service First Foreign Aircraft

The Air India Maintenance Repair and Overhaul (MRO) facility in Nagpur, India, established in 2015, is poised to achieve a significant milestone as it prepares to service its first foreign aircraft—a Boeing 777 from Kuwait. This marks a crucial step for India’s MRO capabilities, positioning the country to capture a larger share of the global $80 billion MRO industry.

Initially, the Nagpur MRO facility was intended to be operated by Boeing as part of an offset deal when Air India ordered 111 aircraft from the US manufacturer. However, Boeing withdrew from the project, and it was subsequently taken over by Air India Engineering Services Limited (AIESL), a subsidiary of Air India. AIESL has been providing maintenance services not only to Air India but also to other domestic carriers, including IndiGo and SpiceJet.

The arrival of the Kuwaiti aircraft represents the first instance of AIESL servicing a foreign airline at the Nagpur facility, demonstrating the facility’s capabilities and potential. Situated in the Mihan Special Economic Zone (SEZ), the MRO facility benefits from tax incentives and export-oriented unit advantages, with AIESL invoicing Air India in US dollars to fulfill the SEZ’s net foreign exchange earnings requirement.

The Indian government has been actively promoting the growth of the MRO sector, which currently accounts for only 2.5% of the global market. Initiatives include reducing taxes and duties, streamlining regulations and procedures, and enhancing infrastructure and skilled manpower. Additionally, there is interest in acquiring AIESL from Air India, following the recent acquisition of Air India by the Tata Group.

Sources: AirGuide Business airguide.info, msn.com, nagpurtoday.in, daijiworld.com