Rajya Sabha passes Bill for resolving airline-lessor disputes, Pg 12

Key Highlights

About the Bill

• The Protection of Interests in Aircraft Objects Bill, 2025 passed to align Indian law with the Cape Town Convention.

• Aims to resolve disputes between airlines and lessors of aircraft and engines.

Need for the Bill

• Addresses legal hurdles faced by lessors in repossessing aircraft due to absence of uniform legislation.

• Triggered by cases like SpiceJet and Go First which defaulted on payments.

Key Provisions

• Recognizes DGCA as the nodal authority to issue directions.

• Seeks to reduce leasing costs by 810%, ensuring clarity and confidence for lessors.

• Covers leasing of high-value movable assets like aircraft, helicopters, and engines.

Significance

• With 86% of Indian aircraft fleet leased, clarity in repossession law is crucial.

• Expected to boost foreign investment, lower airfares, and bring legal uniformity.

Analysis & Way Forward

• The Bill marks a critical step in aligning with global aviation norms, enhancing investor security, and promoting airline liquidity.

• Must be followed by timely implementation and judicial consistency.

Mains Mock Question:

"Discuss the significance of aligning Indias aviation laws with the Cape Town Convention. How will the recent Aircraft Objects Bill impact the aviation leasing ecosystem?"