Leasing in India is on the cusp of growth but not without challenges, believe industry players.
According to Ashwin Naidu, Managing Director, South Asia Marketing at Boeing, India continues to be the fastest-growing commercial aviation market. He said that there is a rapid expansion in infrastructure, spending capacity, and growth within the airline industry as well. This is the growth driver, he explained. Other players echoed this, adding that, India needed to address its challenges.
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Indian as well as international aviation industry players said this while speaking at the Airline Economics Growth Frontiers India 2024, held in New Delhi.
Pain points
One recurring issue is the repossession of assets during insolvency issues. For instance, the GoFirst insolvency proceedings are a classic case of the complexities of asset recovery in the aviation sector, bringing attention to the legal nuances in India.
The delayed implementation of the Cape Town Convention, a global framework influencing aircraft financing, is seen as another pain point.
According to Vishok Mansingh, CEO of Vman Aviation Service, the strategic importance of GIFT City as a hub for aircraft leasing within this regulatory context.
GIFT City’s specialised financial services and regulatory framework were acknowledged for mitigating risks associated with aircraft leasing, although improvements for greater ease of doing business were suggested.
Ashutosh Sharma, General Manager at IFSCA, shared insights into efforts to create an ecosystem inspired by Dublin, fostering collaboration among stakeholders. Dublin and China provided the lion’s share of aircraft leasing across the globe. Sharma said that the IFSCA was working in tandem with the ministry as well as the DGCA to increase the ease of doing business.
He noted that Air India’s presence at GIFT City acted as a positive motivator for the Indian aviation industry.
Amid ongoing matters, the privatisation and expansion of Air India showcased transformative shifts.
Marylou Bilawala, Partner at Wadia Ghandy & Co., highlighted that despite challenges with GoFirst, the privatisation of Air India and its rapid expansion portrayed India in a favorable light within the global aviation landscape.
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As the industry navigated challenges and harnessed opportunities, the discussions at the event underscored the dynamic journey of India’s aircraft leasing sector in 2024