Fierce backlash as what is the western world’s foremost aircraft manufacturer is due to meet with Indian officials this month to discuss bringing the European company’s jet to the Indian aviation market.
Indigo, India’s fifth-largest carrier, plans to buy 100 of Boeing’s popular 787 Dreamliner jets, or roughly $15 billion. But it has abandoned its plans to take delivery of the aircraft because, in part, of the decision by the US government to impose a 25% duty on parts imported from China. It has since reconsidered its decision and asked the United States to reconsider the duty.
The US is the only country that imposes an import duty on Chinese parts used in its aircraft.
Omicron Aero India Pvt. Ltd. – which is one of the world’s largest aircraft suppliers – is aiming to undercut its Indian competitor by further accelerating development of the aircraft’s wing. It says it has been in discussions with Indian manufacturers and others “exploring entry into the Indian market for aircraft and components”, which are eligible for duty exemptions under the recently created Master Plan 2020.
“Aircraft components are eligible for duty exemption under the Master Plan 2020. However, wings are not, and this was the aspect which made the use of the plane very expensive as a part of the aircraft, and companies were working on alternative solutions,” said a senior Indian government official, who didn’t want to be named. “It will be useful if the Indian manufacturer can find a way out from this.”
The government official said the major Indian aerospace firms are already exploring that option and have already worked on issues in “working group” settings. He said negotiations are at a “very sensitive stage”.