17,000 planes are waiting. Indian factories are being pulled into the fix

The queue that will not clear

A customer who orders a plane today may not see it delivered for more than a decade. The world’s two big commercial jet makers are sitting on a backlog of more than 17,000 aircraft, which equates to roughly twelve years of production at current rates [1].

Most of that backlog belongs to Airbus and Boeing. Airbus recently reported a commercial aircraft backlog of roughly 9,362 aircraft, heavily weighted toward the A321neo, with strong demand for the A350 and A350F freighter [2]. Boeing holds a backlog of over 6,700 aircraft, including more than 4,800 outstanding orders for the 737 MAX alone [2].

The pressure to convert those orders into metal is immense. Airbus has talked about delivering around 870 commercial aircraft in 2026, but in a recent August period it managed only 57 [4]. That leaves a required pace of nearly 100 deliveries a month through the end of the year [4].

The bottleneck is not demand. It is the supply chain underneath.

Years of supplier consolidation have concentrated critical components such as engine castings, aerostructures, and specialised forgings into a fragile network of Tier-1 and Tier-2 vendors [1]. On top of that, wage inflation, acute labour shortages, and an aging engineering workforce in North America and Europe are making the traditional manufacturing bases less elastic [1].

The engine crisis shows how bad it has become. Defects in powder metal parts used in Pratt & Whitney’s Geared Turbofan engines have forced inspection and rework of more than 1,200 engines, starving aircraft final assembly lines of propulsion units [5]. Maintenance turnaround times for these engines have roughly tripled from 60 to 90 days in 2019 to between 180 and 240 days [6].

So the plane makers are doing something they resisted for years. They are treating India as a long-term engineering partner, not just a cheap workshop [7].

The Indian numbers behind the shift

India’s aerospace exports have moved from around $1.4 billion in FY20 to $7 billion by FY25 [1]. The country is being embedded into multi-decade aircraft programs rather than doing one-off work [12].

Boeing now sources about $1.4 billion annually from more than 375 Indian suppliers [1]. Airbus sources over $1.6 billion and has said it wants to take that to $2.0 billion before 2030 [1]. Safran plans to lift Indian component procurement to roughly $580 million by 2030 while tripling its overall Indian revenue to over €3 billion by the end of the decade [1].

A closer look at the supplier base shows how deep the integration has become.

The expansion runs across structures, engines, systems, components, and tooling. Unimech supplies aerospace tooling for advanced programs like the LEAP and Pratt & Whitney systems, while JJG Aero and Hical Technologies have reported explosive revenue growth [1]. Industry estimates see India’s share of the global aerospace components market scaling from $1.5 billion to $4 billion by FY29, a compound annual growth rate of 28% [1].

Tiers, drawings, and who owns the design

At the top of aerospace sit the OEMs: Airbus, Boeing, Lockheed Martin. They define the aircraft, the requirements, and the final assembly parameters [9]. Below them, Tier-1 suppliers build major integrated systems and carry real design risk [15]. Tier-2 and Tier-3 suppliers make sub-assemblies, complex parts, raw materials, and build-to-print commodities [9].

Most Indian manufacturing historically sat in the Tier-2 and Tier-3 space under a model called build-to-print. The OEM hands over fully finished drawings, exact material specifications, and fixed tolerances, and the supplier’s job is to execute exactly what the document says [13]. The supplier can be highly efficient, but the OEM keeps 100% of the intellectual property and design authority [13]. Industry leaders admit that this makes suppliers easily replaceable capacity providers [14].

The move that matters is to build-to-spec. There, the OEM describes the performance requirement, and the supplier owns the design, prototyping, and manufacturing needed to meet it [13]. That is a different risk profile because the supplier absorbs design and production risk, but it also opens the door to shared IP, better margins, and longer program stickiness [13].

India has plenty of Tier-2 and Tier-3 suppliers. What it lacks is a deep bench of indigenous Tier-1 system integrators [16]. There are exceptions: HBL Power Systems has been a Tier-1 aircraft battery supplier since 2013, and Accord Software and Systems provides Tier-1 navigation systems that compete globally [16]. Engineering services firms such as Cyient and Quest Global are now helping OEMs with system engineering, avionics, and digital twin work, which anchors the R&D side of build-to-spec execution [17].

Why metallurgy decides everything

Modern aircraft parts sit under enormous thermal and mechanical stress. That is why titanium and nickel-based superalloys are not optional [18]. Until recently, India depended heavily on imported aerospace-grade raw material, leaving companies exposed to global price swings and geopolitical disruptions [18].

MIDHANI, the defence metallurgical public sector unit, changed part of that equation. It has developed and manufactured cast superalloy single-crystal turbine blades [20]. Single-crystal blades are grown as one continuous crystal, eliminating grain boundaries that cause creep, fatigue, and corrosion at high temperature. They can sustain turbine entry temperatures above 1,600°C [21].

That heat tolerance matters because it lets engine designers raise operating temperatures and capture an estimated 2–3% gain in thermal efficiency, alongside up to a 3–5% improvement in specific fuel consumption [22]. The blades recently received certification from the Centre for Military Airworthiness and Certification for the AL-31FP engines that power the Sukhoi Su-30MKI [19].

The raw material side is also being built. MIDHANI and private players such as PTC Industries are expanding titanium production using vacuum arc remelting furnaces that can produce ultra-high purity titanium ingots up to 6.5 tonnes at MIDHANI [23].

The alloys now being localised cover different thermal and structural jobs.

Printing parts instead of carving them

Additive manufacturing, or industrial 3D printing, is moving from prototypes to flight-critical parts [25]. It can create internal cooling channels and lattice structures that are impossible with traditional CNC machining [25]. For aerospace, that means shorter lead times, less raw material waste, and fewer assembled sub-components because multiple parts can be consolidated into one printed article [26].

Techniques like selective laser sintering, electron beam melting, and hot isostatic pressing are being used for high-temperature metal and ceramic work [25]. Some systems now use robotic fused deposition modeling with six-degree-of-freedom arms, closed-loop thermal controls, and in-situ machine vision to monitor defects in real time [27]. Even with that, 5-axis CNC machining remains critical for finishing additively manufactured parts and maintaining the exact tolerances aerodynamic profiles demand [25].

The paperwork barrier is real

A supplier cannot enter aerospace by being cheaper. The industry guards its supply chain with standards [1]. AS9100 Rev D builds on ISO 9001 and adds more than 100 aerospace-specific requirements [28]. Airbus and Boeing mandate it across their networks [28].

The rules force suppliers to manage product safety, operational risk, configuration control, and counterfeit-part prevention [28]. For an SME, implementation and audit costs typically run from $10,000 to $50,000, before counting the time their own people spend on it [29]. Critical processes such as heat treatment, welding, and non-destructive testing also require NADCAP accreditation [30].

First Article Inspection: the brutal first date

When a supplier produces a part for the first time, or changes a design or process, it must pass AS9102 First Article Inspection [31]. The goal is to prove that the production process can consistently make parts that meet every engineering requirement [31].

Think of the FAI package as three tests.

• Part number accountability: which part, which drawing revision, and how it sits in the assembly hierarchy [32].
• Product accountability: every material cert, special process approval, and test result must trace back to the raw material heat lot [32].
• Characteristic accountability: every dimension, tolerance, surface finish, and GD&T callout on the drawing is numbered, measured, and recorded against the nominal value [32].

Missing one process specification revision is enough to get rejected. A single out-of-tolerance measurement sends the FAIR back [32]. For complex parts with internal channels, traditional coordinate measuring machines are often not enough, so industrial CT scanning is used to inspect internal geometry and verify bond line integrity [24]. Once a part clears FAI, switching costs are so high that suppliers tend to be locked into multi-year contracts [1].

The domestic market is the cushion

This is not an export-only story. India is projected to become the world’s third-largest air passenger market by 2030, and domestic carriers have a combined order book exceeding 1,700 aircraft [10].

The Airports Authority of India has announced an airspace and infrastructure expansion of roughly ₹15,000 to ₹17,000 crore, targeted for completion by 2029 [33]. Operators like GMR Airports are pushing greenfield projects, BEL is supplying automation and radar systems, and firms like Cyient are working on geospatial and navigation infrastructure [33].

Even regional aviation is becoming a manufacturing story. Omkam Aviations has signed a Letter of Intent to buy 50 IL-114-300 turboprops from Russia, with a planned initial investment of ₹1,500 crore [34]. The plan starts with importing an initial batch of six aircraft, then moves to a domestic assembly line and eventually full localised manufacturing under a technology-transfer arrangement with Russia’s UAC [34].

Defence policy is the real forcing function

Commercial backlogs pull demand, but defence policy pushes local capability. Under DAP 2020 and offset rules, foreign OEMs that win large defence contracts must reinvest a percentage of the contract value back into India’s aerospace and defence industry [35][37]. DAP 2020 also raises Indigenous Content requirements across procurement categories [36].

The most visible example is the C-295. India signed a ₹21,935 crore ($3 billion) contract for 56 Airbus C-295 tactical transport aircraft [39]. The first 16 will arrive fully built from Seville, Spain [38]. The remaining 40 are being assembled at a new Final Assembly Line in Vadodara, Gujarat, which has already rolled out its first domestically assembled unit [40].

The depth of localisation is extreme. A single C-295 airframe needs about 14,000 detailed parts, and nearly 13,000 of them are being made in India from raw materials [39]. TASL and Airbus have qualified over 125 MSME suppliers across seven states [38]. Major structures come from Hyderabad, Bangalore, and Nagpur before final integration at Vadodara [40]. Domestic content is set to rise from 48% in the first Indian-built airframes to about 96% by the final batches in 2031 [39].

The most important number may not be 17,000. It is the nearly 13,000 of about 14,000 C-295 parts now being made in India [39].

Those MSMEs may end up qualified for commercial work too. The capabilities built for the C-295 can spill into the global 17,000-aircraft backlog.

States are competing to host the factories

Karnataka’s Aerospace and Defence Policy 2026–2031 aims to attract ₹60,000 crore ($7.5 billion) and create 60,000 highly skilled jobs [41]. The state is building decentralised clusters across 33 focused taluks, with investments in high-focus zones eligible for a 30% credit-linked capital subsidy [41]. It is also funding a drone flight testing bed at Chickballapur with ₹42.83 crore and a ₹650 crore space and defence manufacturing park aimed at capturing half of India’s space market [43]. The Udyoga Nidhi scheme adds a ₹2,500 per worker per month subsidy in the most backward districts [42].

Telangana wants Hyderabad to become the Aero-Engine Capital of India by 2030 [44]. Aerospace and defence exports from the state have surpassed ₹30,000 crore, overtaking pharmaceuticals as the leading export segment [44]. Safran has set up a ₹425 crore facility with TASL at Adibatla to make rotating components for CFM LEAP engines [45], and the same park hosts TASL’s AH-64 Apache fuselage work [46].

Tamil Nadu is developing a defence corridor across Chennai, Hosur, Salem, Coimbatore, and Tiruchirappalli [47]. The idea is to convert existing automotive and heavy-engineering strengths into aerospace-grade supply through parks at Vallam Vadagal and Sulur [48].

The aftermarket is a second factory

Manufacturing is only half the story. Maintenance, Repair, and Overhaul is a recurring revenue stream that keeps fleets flying. The Indian MRO market is forecast to grow from roughly $3.1 billion to an estimated $6.9 billion by 2036, with some projections pointing to $7.0 billion by 2034.

Historically, more than 85% of India’s high-value MRO work went overseas because the tax structure made domestic work unattractive [50]. The government cut GST on MRO services from 18% to 5% with full Input Tax Credit, exempted import duties on aviation testing equipment and tools, and allowed 100% foreign direct investment [50].

That is attracting serious capital. Adani Defence Systems & Technologies acquired a controlling stake in Air Works for an enterprise value of ₹400 crore [49]. Safran is building its largest global MRO facility for CFM LEAP engines in Hyderabad, with 45,000 square meters and capacity to service up to 300 engines a year, alongside an MRO shop for Rafale M88 engines [11]. As DGCA aligns CAR-145 with EASA and FAA standards, Indian MROs are moving from basic line maintenance toward component and engine overhauls [51].

How India compares when OEMs pick a hub

OEMs are choosing among China, Vietnam, Mexico, and India under a China-plus-one lens [52]. Each hub brings something different. India’s edge is not raw labour cost alone; it is the combination of engineering depth, digital infrastructure, a large domestic aviation market, and state capital subsidies [7].

Vietnam can assemble electronics at scale, but aerospace demands process controls, documentation, and design comprehension that raw labour arbitrage does not satisfy [53]. When an OEM hands a work package to India, local suppliers are increasingly able to interpret complex drawings, configure tooling, and run stress testing on advanced software platforms [8]. Unlike export-dependent hubs, India’s aerospace push is supported by domestic aircraft demand and sovereign defence procurement, and the BRICS New Delhi Declaration adds a stable multilateral backdrop for strategic investment [54].

What to watch from here

The opportunity does not convert automatically. India has to keep moving from build-to-print work to build-to-spec design authority, to master advanced materials, to adopt additive manufacturing at scale, and to expand MRO capacity. The C-295 is the proving ground. The global backlog is the prize.