India is embarking on an ambitious endeavour to develop its own regional transport aircraft, marking a significant step towards self-reliance in aviation manufacturing.

The government has announced the formation of a Special Purpose Vehicle (SPV) dedicated to this project, with reports as of 21 January 2026 indicating that the SPV is in the advanced stages of establishment but not yet formally launched.

This initiative aligns seamlessly with the Make in India campaign, aiming to bolster domestic production capabilities in the aerospace sector.

Civil Aviation Minister K Rammohan Naidu has expressed strong confidence in India's indigenous expertise. He stated that the nation now possesses the necessary skills to design, manufacture, and maintain aircraft entirely on its own.

This assertion underscores a shift from reliance on foreign imports to harnessing homegrown engineering prowess, potentially transforming India's position in the global aviation market.

The project boasts a substantial budget of ₹12,511 crore, which will fund a comprehensive range of activities. These include design finalisation, prototyping, certification processes, rigorous testing regimes, and the development of essential infrastructure such as manufacturing facilities and testing grounds. Such financial commitment reflects the government's determination to see this venture through to commercial viability.

A key decision lies ahead for the SPV: whether to proceed with the established 90-seater Regional Transport Aircraft (RTA-90) design or to innovate an entirely new configuration.

The RTA-90, previously under consideration, draws from prior efforts like the SARAS program, offering a proven foundation. Alternatively, a fresh design could incorporate cutting-edge technologies tailored to India's unique regional connectivity needs, such as short runways in tier-2 and tier-3 cities.

This development arrives at a pivotal moment for Indian aviation. Domestic airlines have placed orders for over 1,500 aircraft in recent years, driven by surging passenger demand and the expansion of regional routes.

Currently, India depends heavily on imports from manufacturers like Boeing and Airbus, which strains foreign exchange reserves and limits customisation for local conditions. A homegrown regional jet could address these gaps, providing cost-effective, efficient aircraft optimised for India's vast network of underserved airports.

Precedents exist that bolster optimism for success. The SARAS MK-2, developed by the National Aerospace Laboratories (NAL), has demonstrated Indian engineering's potential with its successful prototype flights and certifications.

Building on such achievements, the new project could leverage expertise from organisations like Hindustan Aeronautics Limited (HAL) and the Defence Research and Development Organisation (DRDO), fostering synergies between civil and military aviation.

Economically, the initiative promises multifaceted benefits. It will create thousands of high-skill jobs in design, production, and maintenance, while stimulating ancillary industries such as avionics, composites, and engine manufacturing.

By reducing import dependency, India could save billions in foreign currency and position itself as an exporter of regional aircraft to emerging markets in South Asia, Africa, and Southeast Asia.

Challenges remain, however, and must be navigated carefully. Certification by international bodies like the Directorate General of Civil Aviation (DGCA) and the European Union Aviation Safety Agency (EASA) will be rigorous, demanding adherence to global standards.

Supply chain integration, talent retention, and technology transfers—if partnerships are pursued—will test the SPV's resolve. Past delays in projects like the TEJAS fighter jet serve as cautionary tales, emphasising the need for streamlined bureaucracy and sustained funding.

Geopolitically, this move enhances India's strategic autonomy. In an era of supply chain disruptions and export restrictions, indigenous production ensures resilience. It also aligns with broader national goals, including the Atmanirbhar Bharat vision, potentially attracting investments from global players seeking to co-develop or localise production.

For aviation enthusiasts, technology professionals, and patriots alike, this project represents a thrilling prospect. Success could catalyse a new era of Indian aerospace innovation, rivalling global leaders and connecting remote regions more effectively. As the SPV takes shape, all eyes will be on its first milestones, from design freeze to maiden flight.

IDN (With Agency Inputs)