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Indian owners could be allowed to use management companies

BEAM Staff
August 10, 2018

Private jet owners in India are currently required to manage and operate the aircraft themselves as per the local regulations. This, however, could soon change with a new discussion at the Indian Ministry of Aviation, allowing owners to transfer operations of their aircraft to management companies.

Under the current set up, Indian business jet ownership comes with the added complication of having to set up your own flight department, with accountable managers, flight crew under contracts. Essentially operating your own private airline.

New regulations discussed by the ministry could mean that management companies will be able to take over operations of the aircraft and, ultimately, be liable for its operations, depending on the set up of the deal. Similar frameworks, allowing hands off ownership, have widely been utilized in the US and Europe, the two largest markets for private aviation.

iStock / Yatrick Sheth

Despite seeing a boom for commercial aviation, with an additional 2,100 airplanes needed across the country over the next 20 years to keep up with growth according to analysts, the private jet sector has been slow to develop. Experts point to airport facilities that are oversaturated by commercial flights, making private operations complicated.

Taxes on the import of private aircrafts is also 28% in India, with this dropping down to 2.5% if the jet is being used in the charter market. Meaning most owners make their plane available for rent, leading to many individual flight departments, a space that could now be consolidated across major European and US management companies in what could become a new gold rush. Pending regulations.

Lead photo iStock / SkyF