The government is likely to complete in the next two weeks framing of the draft of revised rules for its scheme to promote low-cost air travel and put up for stakeholder consultations, as it prepares for the second round of bidding by airlines. The Ministry of Civil Aviation undertook a comprehensive review of the rules, including those relating to the number of discounted seats in a plane and exclusive flying rights for carriers on select routes, under its regional connectivity scheme (RCS).
“In another two weeks, we will be putting out the RCS (rules) with amendments for public consultations,” Ministry of Civil Aviation Secretary R N Choubey told PTI.
Without elaborating on the specifics, the top official said the revision is being done with an emphasis on increasing competition.
“Our intention is to decrease entry barriers and increase competition. We would like to bring as many players as possible. We want to create a level-playing field so that small players can bid aggressively,” Choubey added.
In the first round of bidding, which concluded in March, five airline operators were awarded 128 routes.
The regional connectivity scheme became operational last month with the first flight under it being inaugurated on the Shimla-Delhi route.
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The government’s scheme, also known as UDAN (Ude Desh Ka Aam Naagrik), aims at making flying affordable for the masses by capping fares at Rs 2,500 per hour on selected routes. Airline operators need to make available 50 per cent of total seats in an aircraft at these discounted prices.
In order to keep the fares low, the government provides a subsidy, or viability gap funding, to the airline operators.