Govt announces new MRO policy for civil aviation space; seeks to attract investments

To attract more investments, the civil aviation ministry on Thursday announced a new policy for Maintenance, Repair and Overhaul (MRO) services that includes leasing of land through open tenders and abolishing royalty charged by the AAI.




Besides, land allotment for entities setting up MRO facilities will be done for 30 years instead of the current short term period of 3 to 5 years.

Announcing the new policy, Civil Aviation Minister Jyotiraditya Scindia said discussions are on for having military and civil convergence with respect to MRO activities.

The aim is to make India a “global MRO hub”, the minister noted.

Under the new policy, the rate of lease rental would be decided through bidding instead of the current practice of having pre-determined AAI (Airports Authority of India) rates.

Also, the rate of escalation for lease rental would be 15 per cent after every 3 years. At present, the escalation rate is 7.5 per cent to 10 per cent per annum.

The land will be allotted through open tenders instead of the current practice of allotment based on an entity’s request.

According to the minister, there will also be changes in the renewal of the contract of existing leaseholders.

On the expiry of existing contracts, the land given to these MROs would be allotted on the basis of a bidding process.

“The existing MRO would have the right of first refusal if his bid is within 15 per cent of the bid given by the highest bidder, and he agrees to match the rates quoted by the highest bidder. Also, the existing MRO shall settle all disputes and clear all the outstanding dues,” the ministry said in a note.

To push MRO activities for aircraft and helicopters in the country, the ministry has identified eight airports for attracting investments to set up MRO facilities.

The eight airports are those at Begumpet, Bhopal, Chennai, Chandigarh, Delhi, Juhu, Kolkata and Tirupati.

Besides, the ministry plans to go live with AirSewa 3.0 portal by September 30.

“Under AirSewa 3.0 a feature is being developed wherein a user can escalate the ticket to escalation officer in stakeholder organisation, if he is not satisfied with the resolution by a nodal officer,” as per the note.

Scindia said the closure of grievances by passengers is at the level of airlines as well as passengers. He also cited data to show that there has been a 93 per cent reduction in grievances at the end of August.

Talking about AirSewa, which provides an e-platform for air passengers to seek redressal for their complaints, Scindia said efforts would be made to popularise AirSewa and that airlines would also be responsible for refunds. QR codes will be printed on each ticket of the AirSewa portal, he added.

The minister also said that eight Flight Training Organisations (FTOs) at AAI airports are being set up under the PPP model in the first phase at Belagavi (Karnataka), Jalgaon (Maharashtra), Kalaburgi (Karnataka), Khajuraho (Madhya Pradesh) and Lilabari (Assam).

As part of the 100-day plan, Scindia said five airports would be operationalised under the regional air connectivity scheme UDAN. The airports are Keshod (Gujarat), Deoghar (Jharkhand), Gondia (Maharashtra), Sindhudurg (Maharashtra) and Kushinagar (Uttar Pradesh).

Besides, six heliports would be operationalised under UDAN. They would be at Sanjoli (Shimla), Sase (Manali), Mandi and Baddi in Himachal Pradesh; and at Haldwani and Almora in Uttarakhand.

Further, the ministry said 50 routes would be operationalised under UDAN and 30 of them would be operational by October.

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Regarding infrastructure targets, Kushinagar in Uttar Pradesh is ready for inauguration and would be part of the Buddhist circuit. The cost of the aerodrome is Rs 255 crore.

Other initiatives include new terminal buildings at Dehradun airport costing Rs 457 crore and at Agartala airport. The latter’s cost is Rs 490 crore.

Scindia also mentioned about upcoming Jewar airport in Uttar Pradesh and the total project cost is Rs 29,560 crore.