Business Aviation Financing in India: A Growing Market Finding Its Footing

India’s business aviation sector is no longer a niche market quietly operating in the shadow of its commercial counterpart—it is fast becoming one of the most active growth stories in Asia-Pacific aviation. A fleet that has expanded at a remarkable pace, rising wealth among Indian entrepreneurs and corporates, and a regulatory ecosystem in active transition are gradually changing how financiers, lessors, and operators engage with the market. Yet for all its momentum, the sector remains underserved—financing options are limited, regulatory alignment is still evolving, and landmark frameworks like GIFT City and the Cape Town Convention have yet to fully prove themselves in practice. In this interaction, Simon Davies, VP Sales for UK, Middle East, and India at Global Jet Capital, captures this reality precisely: the opportunity is undeniable, but the infrastructure—financial, regulatory, and physical—must scale alongside it.

You offer several financing structures, leases, loans, and sale-and-leaseback, among others. What does a client typically come to you for, and has that changed in the last few years?

Each client has their own view on what they are seeking to achieve, and this differs by geographic location. Global Jet Capital seeks to understand what a client really hopes to achieve through the financing structure. This could be an equity release from an existing aircraft that the client currently owns, or reducing the amount of cash needed to be deployed to acquire a new aircraft. Some clients may want to avoid resale value risk in the future, while others are driven by having the maximum advance amount for the aircraft.

In India, we are seeing a shift from the traditional debt products (loans and finance leases) with more clients looking at operating lease solutions as an effective financing solution. The current tax structures in India also push more clients to consider a lease over borrowing.

How would you describe the business aviation financing market in India today? Is it growing, underserved, or both?

Historically, India has had a relatively small business aviation sector. In recent years, however, the market has undergone significant expansion, with the in-country business jet fleet increasing by nearly 400%. This rapid growth has outpaced the development of supporting financial services, leaving the market for business aircraft financing largely underserved.

At present, only a limited number of international lenders actively finance Indian-registered aircraft, and even fewer offer leasing solutions. While this financing gap remains pronounced, the landscape is beginning to evolve.

A growing number of domestic financial institutions are entering the sector and developing debt-financing products for select clients. Despite this encouraging trend, the market remains in its formative stages.

Most Indian lenders are still building the specialised expertise required to assess, structure, and manage aviation finance transactions. As a result, significant opportunities remain for both domestic and international financing providers as the country’s business aviation sector continues to mature.

What financing structures work in India right now, and which ones remain difficult to execute given the regulatory and tax environment?

From a financing perspective, the traditional structures used in business aircraft transactions are generally well established and readily adaptable to the Indian market. The greater challenges tend to arise not from the financing arrangements themselves, but from the operational frameworks that aircraft owners and operators seek to implement.

A key consideration is ensuring that proposed operating structures satisfy the requirements of both the Directorate General of Civil Aviation (DGCA) and the Reserve Bank of India (RBI). Aligning regulatory approvals with financing and ownership arrangements can be a complex exercise, often representing the most challenging aspect of a transaction.

That said, the market is steadily maturing. As the volume of financed aircraft transactions increases and transaction structures become more familiar to regulators, lenders, and operators alike, expectations are becoming increasingly aligned. This growing institutional experience is helping to streamline approvals and reduce friction between operational objectives and regulatory compliance requirements.

GIFT City was meant to change the equation for aircraft leasing in India. Has it, specifically for business jets?

GIFT City has unquestionably strengthened the landscape for aircraft leasing and financing solutions available to Indian clients. While business aviation represents a significantly smaller market than commercial aviation, in terms of both transaction volume and capital deployment, it nonetheless benefits from the regulatory and structural innovations initially developed for the commercial sector.

As is often the case, developments that originate in commercial aviation gradually extend to the business aviation market, although adoption can take time as stakeholders become familiar with new financing and leasing structures. This evolution is particularly evident in the context of GIFT City, where regulators have continued to refine and enhance the legal and regulatory framework governing aircraft leasing activities.

These ongoing improvements are helping to increase market confidence and should further strengthen GIFT City’s position as a competitive leasing hub. As the framework continues to mature, it is expected to attract a growing number of inbound leasing solutions and broaden the range of financing options available to Indian business aviation operators and owners.

Where has GIFT City proved harder than expected for business aviation? Is it tax treatment, foreign-exchange approvals, enforcement, or the complexity of setting up the entities?

As a relatively new financial framework, GIFT City continues to see ongoing refinement of its regulatory regime, particularly in relation to the use and structuring of financing solutions. For financiers, the immediate challenge lies in staying abreast of these evolving requirements and ensuring compliance with the latest regulatory developments.

However, the trajectory of change is broadly positive. The adjustments being introduced reflect a clear shift toward international best practices and are gradually contributing to a more efficient and streamlined transactional environment. As the framework matures, these incremental improvements are expected to further enhance clarity, predictability, and ease of execution for market participants.

India acceded to the Cape Town Convention to give foreign lenders greater confidence in asset recovery. Has it made a practical difference to how you assess Indian deals?

The more comprehensive integration of the Cape Town Convention into Indian domestic law represents, in principle, a significant step forward for foreign financiers. On paper, it enhances creditor protections and offers a greater degree of confidence around the potential recovery of aircraft in the event of a default.

However, as was highlighted at a recent conference in Delhi focused on business aircraft financing, the practical application of these amended procedures remains largely untested. This lack of precedent introduces a degree of uncertainty regarding how effectively the new framework will operate in practice.

In the absence of demonstrable outcomes, some scepticism persists within the market.

Business aircraft financiers, in particular, often look to developments in the commercial aviation sector as a leading indicator of how regulatory changes may ultimately be applied to their segment.

As a result, many participants in the business aviation finance space are adopting a measured and cautious stance, preferring to observe how the regime performs in practice before materially increasing activity.

Within Asia-Pacific, where does India stand today in terms of actual deal activity, and where do you see it in five years?

India is emerging as one of the most active and strategically important business aviation markets outside the United States. This expansion is underpinned by exceptional wealth creation over recent decades, a trend that is widely expected to continue.

If the sustained growth of the commercial aviation sector is any indication of broader travel demand, it similarly points to a rising long-term appetite for business aviation. As connectivity needs become more sophisticated, the role of business aircraft is likely to expand in parallel.

The primary constraint on this growth—absent any material geopolitical disruptions—lies in infrastructure. In particular, the ability of airports and airspace systems to scale in line with demand will be critical.

Should commercial aviation continue to absorb an increasing share of available airport slots at major hubs, business aviation operations may face increasing constraints. Such limitations could, in turn, influence purchasing decisions at the margin, as prospective users weigh the practicality of acquiring and operating business aircraft within a potentially congested aviation environment.

Also Read: How India Taxes Business Aviation Out of Its Own Market