Finshots Daily Can GIFT City take off as India’s aircraft leasing hub?
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Feb 17, 2025 Exploring GIFT City’s ambitions, the discussion reveals why Indian airlines lean towards leasing aircraft. It highlights legal advancements aiding lessors, alongside the competitive challenges that GIFT City faces against established hubs like Ireland. Will GIFT City’s dream of becoming a major aircraft leasing center soar, or will it remain grounded?
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Aircraft Leasing in India
- Roughly 90% of Indian airlines lease their fleets due to the high cost of aircraft ownership.
- Leasing allows airlines to avoid large upfront investments, conserve cash, and expand their fleets.
Aircraft Leasing Business
- Aircraft leasing is profitable for leasing companies, who buy planes in bulk at discounts and lease them to airlines.
- Even if an airline fails, lessors can re-lease the aircraft, generating revenue over its lifespan.
GIFT City's Aspirations
- India aims to become a player in the aircraft leasing market, with GIFT City offering incentives like tax holidays.
- Despite attracting global leasing companies, few have engaged in leasing transactions due to India's leasing ecosystem.