Jaideep Mirchandani also highlights the Protection and Enforcement of Interests in Aircraft Objects Bill as a major step toward strengthening aircraft leasing in India.
India’s Aviation Sector Poised for Growth
In 2025, India’s aviation industry is set for major mergers, fleet expansions, and regional network growth, alongside key infrastructure projects such as the inauguration of Navi Mumbai and Noida International Airports. Between January and November 2024, Indian and foreign operators carried 64.5 million passengers on international routes, while domestic airlines operated 1.02 million scheduled flights, transporting 146.4 million passengers.
The rising demand for air travel underscores the need for more wide-body aircraft and strategic solutions to tackle ongoing supply chain challenges. According to Boeing’s 2024 Commercial Market Outlook for South Asia, India is set to drive South Asia’s aviation boom, with over 2,700 new aircraft deliveries expected by 2042.
Infrastructure Status for Aircraft: A Game-Changer
“Given the current landscape and future growth projections, granting infrastructure status to aircraft would be a significant step forward,” says Jaideep Mirchandani, Group Chairman of Sky One.
Currently, aircraft do not hold infrastructure status in India, requiring airlines to secure commercial loans at higher interest rates for fleet expansion. Given that aviation is a capital-intensive industry, this adds financial strain on airlines at a time when expanding fleets is essential to meet increasing passenger demand.
Potential Benefits of Infrastructure Status
Reports indicate that the Union Government is considering granting infrastructure status to aircraft as an asset. Mr. Mirchandani believes this move could provide a major boost to the industry.
“If the Civil Aviation Ministry grants infrastructure status to aircraft, it would transform the way airlines finance fleet expansion. A key benefit would be access to affordable loans under the Priority Sector Lending (PSL) scheme, which mandates banks to allocate funds to sectors crucial for economic growth,” he explains.
Under PSL, airlines could secure lower-interest loans, significantly reducing financial burdens and facilitating expansion plans.
Aircraft Leasing & Protection Bill: Strengthening Market Confidence
Mr. Mirchandani also emphasizes the importance of the Protection and Enforcement of Interests in Aircraft Objects Bill, which aims to reduce aircraft leasing and financing costs for Indian carriers.
“The Bill, once passed in Parliament, will lower aircraft leasing costs and bring India closer to ratifying the Cape Town Convention—a key factor in reducing leasing expenses and boosting lessor confidence,” he states.
The delayed ratification of the Cape Town Convention has led to higher leasing costs, as creditors remain cautious. Passing this Bill will enhance India’s credibility, cut lending costs, and ultimately lead to lower airfares.
GIFT City: A Key Hub for Aircraft Leasing
Mr. Mirchandani further highlights that increased aircraft leasing at India’s GIFT City will be possible with the Bill’s ratification.
“The legal uncertainties around aircraft repossession have been a concern for lessors. This new Bill can eliminate these worries, encouraging more leasing entities to register at GIFT City. As leasing activities increase, this could make air travel more affordable for passengers,” he concludes.