GIFT CITY TRANSFORMING AIRCRAFT LEASING IN INDIA

With India's aviation sector expanding rapidly, GIFT City is emerging as a key enabler in the aircraft leasing space. By offering a well-structured financial ecosystem, regulatory clarity, and competitive tax incentives, it is attracting global players to set up operations in India. NITIN SARIN, Managing Partner, Sarin & Co. shares insights on how GIFT City is shaping the future of aircraft leasing.

- NITIN SARIN

GIFT City is revolutionizing the aircraft leasing industry in India, offering a structured and globally competitive environment for lessors and financial institutions. Located in Gujarat, this futuristic financial hub operates as a Special Economic Zone ("SEZ"), providing significant tax advantages and a robust regulatory framework to attract international players. Designated as an International Financial Services Centre ("IFSC"), it provides a conducive ecosystem for banks, insurance companies, and financial institutions looking to expand internationally.

Nitin from Sarin & Co. highlights, “With India's aviation sector experiencing rapid growth, GIFT City serves as a transformative force, enabling domestic businesses to participate in global aircraft leasing while capitalizing on an efficient regulatory structure and attractive tax benefits.”

Recognizing this surge, the Indian government designated Aircraft Lease as a financial product under Section 3(1)(d) of the International Financial Services Centre Act, 2019. This move incentivizes foreign aircraft lessors to relocate their operations to India and establish Special Purpose Vehicles (SPVs) in GIFT City.

Nitin elaborates, “The creation of a structured framework ensures that international players have a seamless entry into India, making the country more self-reliant in aircraft leasing and financing. Moreover, this regulatory clarity encourages long-term investments and stability in the sector.”

How Lessors Can Establish in GIFT City

Steps for Setting Up an Aircraft Leasing Unit in GIFT City

I. Identification of office space in GIFT SEZ and securing a Provisional Letter of Allotment from GIFT SEZ.

II. Incorporation of the unit in IFSC and obtaining tax registrations.

III. Application to SEZ authorities for setting up IFSC unit. Upon approval, procurement of Final Letter of Allotment.