India is set to have three dedicated special economic zones (SEZs) for aerospace in the next five years, just as global aerospace and defence majors stepped up outsourcing to India to meet local demands and cut costs.

According to Pricewaterhouse Coopers, India received the largest number of foreign investments in aerospace research and development in 2000-08. Also, India received the highest number of investments in aerospace manufacturing after China.

There are high level of discussions in the Government to promote Aerospace SEZs to fuel the growing market for military and passenger aircrafts, need for repair and maintenance units and consequently local development of aircraft.

Apart from the tax incentives and generation of local jobs by means of these large SEZs, the government is studying the requisite large capital commitments and long-term commitments that may be required by the companies in the aerospace business.

-Prashant Salvi

Based in Mumbai, Prashant Salvi is NAI Global’s Regional Director for India.