The MRO Association Of India (MAOI) has written to Ministry of Civil Aviation drawing its urgent attention to the dwindling Maintenance, Repairs & Overhaul (MRO) industry. Declaring the industry’s present state to be in dire straits, the Association has appealed to the Ministry to offer the Indian MRO industry at least a fair chance to compete with foreign MROs that enjoy a favourable import tax policy of the Indian Government.
The MAOI has stated that the lopsided tax policies have led to 90 per cent of the MRO requirements of India being imported; causing severe loss to the Indian MRO industry and the Government’s tax revenues. With the Government’s timely intervention and support, the MAOI aims to convert today’s US $1.4 Billion of net import of MRO into a US $5 Billion export in the next 5 years.
“The Indian MRO business has been on a gradual decline and for the first time in its history has registered negative numbers this year. We cannot stress enough on the plight of our industry and are hoping for the Government to intervene before it’s too late. It is estimated that the current MRO import bill for the year 2017-2018 of US $1.4 billion will rise to US $3 billion by 2023. This import driven policy has lost 90,000 direct jobs to countries like Sri Lanka, Singapore, Thailand, France and Germany. These jobs can easily be brought back to India by correcting the fiscal tax imbalance that has affected this industry since independence. Indian engineering is amongst the best in the world and allowing this drain of precious skill and ForEx to foreign locations is unwarranted,” said Bharat Malkani, President, MAOI.
The Association has pointed out to the skewed tax regime that has been benefiting foreign players while putting the domestic players at a disadvantage. The present GST for importing MRO services to India is levied at a maximum 5 per cent, whereas the same services offered at home are taxed at GST of 18 per cent. This makes it unviable for Indian airline carriers to even consider us for doing the job.
