Protests from India's carriers has led the Indian government to drop a four-year restriction barring operators which are locally registered from dry-leasing aircraft from foreign airlines.

Government and airline sources in India say that the revised guidelines were introduced recently by means of an Aeronautical Information Circular. Controversial rules barring the dry-leasing of aircraft from foreign carriers were introduced in 1998.

A source at the Indian Directorate General of Civil Aviation (DGCA) says the changes were implemented following pressure from the country's private carriers, which are seeking to expand their fleets to keep up with growing demand.

State-owned Indian Airlines is also seeking to expand its fleet with dry-leased Airbus A320s. International tender notices published recently call for offers on aircraft from "established companies/owners/operators/airlines".

The controversial rules barring aircraft leases from foreign carriers were part of a restrictive civil aviation policy. When it was introduced, the government said that it considered the lease of aircraft by a foreign carrier to a domestic airline to be an investment in the local industry, which the new civilaviation policy barred.

The regulatory changes relating to aircraft leases in 1998 forced privately owned Jet Airways to return a handful of dry-leased Boeing 737s to owner Malaysia Airlines.

The government later amended the restrictions to allow aircraft to be wet-leased from foreign airlines, but only for short-term periods to replace aircraft due for maintenance or those which had been involved in an accident.

Source: Flight International