More than 70% of Indian aircraft deliveries will be on lease

According to FICCI’s recent report titled ‘Opportunities and Financing  Outlook for Aviation Sector’, there will be a huge number of aircraft deliveries in India in the next few years. The report quoted a CAPA study, which estimated that out of 400 aircraft deliveries by FY22 to Indian carriers, 70-80 per cent of them will be either on direct lease or sale and leaseback transactions.

To fulfil growing demand, the Government has envisaged huge capex of around US$ 15.5 billion towards development of Greenfield airports, expansion of Brownfield airports, fleet addition & maintenance by Indian Carriers and strengthening ancillary services like skill development, MRO, Cargo handling, amongst others in the value chain. This development plan by airports and airlines requires strong support from Banks, Lessors, Private Equity Firms and other Financial Institutions to cater their funding requirement.