Ravi Menon, the executive director of Air Works, a Mumbai-based aircraft maintenance company, talks about the issues holding back the growth of the maintenance, repair, and overhaul (MRO) sector in India, as Indian airlines currently opt to go abroad for much of the maintenance work on their planes.
Are you likely to benefit from new airlines launching in India and traffic growth as more Indians take to the skies?
We will definitely benefit from growth but there are challenges, no doubt. I think there are quite a few reforms to be driven by the ministry of civil aviation and the regulatory authority if one is to create an environment that is conducive to invest in, knowing fully well that we are well-positioned and competitively positioned to capture the business in India.
Could you expand on what those challenges are?
One of the biggest challenges we have is our tax and duties structures. For India, although people talk about competitive labour pricing, that labour arbitrage can’t be leveraged because it is offset by the high duty and tax structure.
What other issues are holding the MRO sector back?
One impediment is where is the space at various airports? That is not easily accessible because the airports haven’t made a provision to have certain areas allocated for the development of MRO. It hasn’t been given the kind of recognition that it really deserves. Some of the wake-up calls is the fact that there’s approximately US$750 million to $800m of business being generated by the airlines in India that is being sent abroad, in terms of air frame maintenance, engines, and components. That is the kind of loss of opportunity that the country is facing. It has been recognised by the ministry and they are taking steps to make certain corrections. It’s important for every country to have self-sufficiency in maintenance for their fleet of aircraft.
Is a lack of skills in this field in India a problem?
If I were to be asked what’s the biggest risk to the MRO space or aviation space, I would say it’s a lack of qualified and competent people. There are schools but those schools are perhaps more theoretical in their approach rather than an element of practical training. Anyone can open a school but who is going to train the trainer? These are certain questions that we will be faced with. We’re going to need to have the right hand-holding from developed aviation markets to really participate in this entire training process. Currently, the airlines in the Middle East are really sucking up the talent out of India. In the last two months, we as an organisation saw 12 key personnel resign to move to Qatar.
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