GIFT City & The Aircraft Objects Act, 2025: Catalysing India's Rise in Global Aviation Finance

The article co-authored by Nand Gopal Anand, Partner and Vrindesh Patel, Sr. Associate from JSA's Banking & Finance Practice dwells upon India's evolving legal and tax framework for aircraft leasing, the strategic role of GIFT City in competing with global aviation finance hubs and how the recent legislative reforms support capital self-reliance in aviation, aligned with the 'Atmanirbhar Bharat' vision.

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India's aviation sector has rapidly become a focal point in global markets, underpinned by robust economic growth, burgeoning middle class, and progressive policy reforms. Today, India stands as the third-largest domestic aviation market. Recent initiatives, such as the expansion of UDAN scheme, and development of 50 new airports, alongside ongoing Greenfield developments of Noida and Navi Mumbai International Airports, reflect Government's comprehensive strategy to promote air travel and foster inclusive regional growth and connectivity.

Building on this momentum, Indian airlines have been placing record-setting aircraft orders, to cater the current and anticipated demand. This presents a unique opportunity for India to evolve from a high-demand market into a global centre for aircraft leasing and financing. Traditionally, this market has been dominated by jurisdictions like Ireland, Singapore, and Hong Kong, owing to their favourable tax and legal regimes. The Gujarat International Finance Tec-City (GIFT City) encompasses the required catalysts for achieving India's ambition to become a global aviation finance hub, by providing a competitive platform for financial services and cross-border transactions.