Aiming to cut import reliance, the government may grant infrastructure status to boost domestic aircraft production.
The government is considering granting infrastructure status to aircraft manufacturing to boost domestic production and reduce import dependence, sources told Financial Express. The move is aimed at attracting joint ventures with global partners for manufacturing regional passenger and cargo aircraft, catering to India’s rapidly expanding aviation market.
If approved, aircraft manufacturing will be added to the Harmonised Master List (HML) of infrastructure, unlocking access to long-term concessional financing, funds from insurance and pension institutions, easier external commercial borrowings, and various tax incentives. The HML currently covers five major sectors and 38 sub-sectors, with “large ships” under Transport and Logistics added in September 2025. Petroleum refineries are also under consideration for inclusion.
The initiative aligns with national priorities such as Make in India and Atmanirbhar Bharat, seeking to develop a self-reliant aerospace ecosystem. The move builds on the Airbus-Tata Advanced Systems partnership for manufacturing C295 tactical transport aircraft in India, which will be the first locally produced unit is expected by September 2026.
Officials said regional aircraft manufacturing, including models like ATR and Embraer, could be the next frontier. India’s Regional Connectivity Scheme (UDAN) has already operationalised 619 routes and connected 88 airports since 2016, promoting affordable air travel and balanced regional growth. The government expects indigenous manufacturing to further strengthen this expansion and develop skilled manpower for the aviation sector.
