**Policy Summary: Protection of Interest in Aircraft Objects Bill, 2025**
The Protection of Interest in Aircraft Objects Bill, 2025, was enacted to implement the Convention on International Interests in Mobile Equipment and the Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Aircraft Equipment, signed in Cape Town on November 16, 2001. The bill received Presidential assent on April 16, 2025.
**Key Objectives:**
* Improve India's CTC Compliance Index score to enhance its position in the global aircraft leasing and financing market.
* Provide legal certainty through primary legislation to reduce risk premiums and lower interest rates and lease rentals for aircraft financing/leasing.
* Ensure better contract enforceability and repossession certainty for creditors and lessors, improving the ease of doing business in India and boosting the growth of domestic leasing hubs, such as GIFT City.
* Facilitate favorable international financing and leasing markets for Indian carriers, enabling network expansion and fleet modernization.
**Expected Outcomes:**
* Airlines anticipate an 8% to 10% reduction in aircraft leasing costs due to the legislation.
* The estimated number of leased aircraft operating in India is 870, with 750 deployed in scheduled operations and 120 in non-scheduled operations.
* Fleet augmentation, airline network expansion, and reduced financing/leasing costs are expected to encourage competition and potentially lower airfares for passengers and cargo.
Key Entities Referenced
Protection of Interest in Aircraft Objects Bill, 2025: A bill passed by the Parliament of India to implement the Convention on International Interests in Mobile Equipment and the Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Aircraft Equipment.
Ministry of Civil Aviation: The Indian government ministry responsible for the formulation and administration of the rules, regulations and laws relating to civil aviation.
Shri Murlidhar Mohol: Minister of State in the Ministry of Civil Aviation.
Convention on International Interests in Mobile Equipment: An international treaty intended to provide a standardized set of legal rules for the creation and enforcement of security interests in mobile equipment, such as aircraft.
Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Aircraft Equipment: A protocol to the Convention on International Interests in Mobile Equipment that specifically addresses issues related to aircraft equipment.
Cape Town: The city in South Africa where the Convention on International Interests in Mobile Equipment and the Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Aircraft Equipment were signed.
GIFT City: An upcoming global financial hub in Gujarat, India expected to benefit from the Protection of Interest in Aircraft Objects Bill, 2025.
Parliament: The legislative body of the Republic of India.
GOVERNMENT OF INDIA
MINISTRY OF CIVIL AVIATION
LOK SABHA
UNSTARRED QUESTION NO. : 1864
st
(To be answered on the 31 July 2025)
OBJECTIVES OF AIRCRAFT OBJECTS BILL, 2025
1864. SHRI SATISH KUMAR GAUTAM
SHRI YOGENDER CHANDOLIA
SHRI VISHWESHWAR HEGDE KAGERI
SHRI MUKESH RAJPUT
SHRI CHINTAMANI MAHARAJ
SHRI DAMODAR AGRAWAL
SMT APARAJITA SARANGI
DR. MANNA LAL RAWAT
SHRI JAGDAMBIKA PAL
SMT KAMALJEET SEHRAWAT
SHRI JANARDAN MISHRA
SHRI PRATAP CHANDRA SARANGI
SHRI SHANKAR LALWANI
DR. LATA WANKHEDE
SHRI PRAVEEN PATEL
Will the Minister of CIVIL AVIATION
be pleased to state:-
(a) the key objectives of the Protection of Interest in Aircraft Objects Bill,
2025;
(b) the estimated reduction in the cost of lease of aircraft for Indian carriers
due to the provisions of the said Bill:
(c) the estimated number of aircrafts taken on lease and operating in the
country; and
(d) whether the said Bill is likely to have any impact on the system of
determining prices of air tickets in the country and if so, the details thereof?
ANSWER
Minister of State in the Ministry of CIVIL AVIATION
(Shri Murlidhar Mohol)(a):India had acceded to the Convention on International Interests in Mobile
Equipment and the Protocol to the Convention on International Interests in
Mobile Equipment on Matters Specific to Aircraft Equipment signed in Cape
Town on 16th November, 2001. In order to implement the said Convention
and Protocol, 'The Protection of Interests in Aircraft Objects Bill, 2025' was
passed by the Parliament and thereafter has received Presidential assent on
16th April, 2025. The key objectives of the legislation are as follows:
(i) To improve India's CTC Compliance Index score and enhance its position
in the global aircraft leasing and financing market.
(ii) To provide legal certainty through primary legislation, thereby reducing
the risk premium, lowering interest rates and lease rentals for
financing/leasing of aircraft.
(iii) To ensure better contract enforceability and repossession certainty for
creditors and lessors, which will improve the ease of doing business in India
and boost the growth of domestic leasing hubs such as the GIFT City.
(iv) To facilitate favourable international financing and leasing markets for
Indian carriers, enabling them to expand their network connectivity and
modernize their fleets.
(b):The airlines have informed that through the enactment of the legislation,
aircraft leasing costs are likely to be reduced by 8% to 10%.
(c):The estimated number of leased aircraft in India is 870, out of which 750
are deployed in scheduled operations and 120 are deployed in non-scheduled
operations.
(d) :The augmentation of fleet, expansion of airline networks and reduced
financing/leasing costs is expected to encourage healthy competition and
translate into lower airfares for passengers and cargo.
*****