The money is being given to the Pacific division of the Aerospace Industries Association of Canada, a non-profit group that advocates for its members on policy issues.
The announcement was made in the Vancouver Island community of Sidney, B.C., Tuesday, the home of Viking Air Limited, which manufactures de Havilland aircraft products.
It will be used to help build trade opportunities, develop a globally competitive supply chain, improve research-and-development capabilities in B.C., access a "fair share" of federal programs and leverage training programs, states a media release.
"With its deep-rooted local base and strong international network, the British Columbia aerospace industry is a provincial innovation leader that is poised to take advantage of unprecedented global growth opportunities in the years ahead," said David Schellenberg, the association chairman in a statement.
"The government's investment in our industry will not only help us accelerate that growth, but it will also provide tremendous benefits to British Columbia's workers, tax payers and economy."
B.C.'s aerospace and defence industry is already known for its highly specialized services and products and is close to the final aircraft assembly lines of Boeing in Seattle, Wash., said the provincial government.
In fact, Finance Minister Mike de Jong said the industry currently generates about $1.2 billion in annual revenue and employs about 10,000 people in the province.
But the Ministry of Jobs, Tourism and Skills Training states there's more opportunity on the horizon.
It states that about half of the world's growth in air traffic over the next 20 years will be tied to the Asia-Pacific region.
Total air-traffic for the region will grow annually by 6.7 per cent and air cargo will grow by 6.3 per cent per year, said the ministry.
To meet the demand and modernize their fleets, airlines will need 12,000 new airplanes worth about $1.9 trillion over those 20 years, the ministry adds.
"This is an example of investing taxpayer's money now and seeing the economy benefit for decades," said de Jong in a statement.
The funding is included in the 2014 budget and is part of a $5-million, five-year commitment to the industry.
-- By Keven Drews in Vancouver