1. Government sets out to ‘refine’ UDAN framework

Government sets out to ‘refine’ UDAN framework

The government is looking to "refine" the present norms for regional air connectivity scheme as it prepares for the second round of bidding in three months, according to a senior official.

By: | New Delhi | Updated: May 7, 2017 3:53 PM
The government is looking to “refine” the present norms for regional air connectivity scheme as it prepares for the second round of bidding in three months, according to a senior official. (Reuters)

The government is looking to “refine” the present norms for regional air connectivity scheme as it prepares for the second round of bidding in three months, according to a senior official. While the scheme became operational after the first flight from Shimla to the national capital, the authorities have started the groundwork to comprehensively review its framework, including those relating to the number of seats and exclusivity period for an airline.

The ambitious scheme — UDAN (Ude Desh ka Aam Naagrik) — seeks to connect un-served and under-served airports as well as make flying more affordable for the masses. The Airports Authority of India (AAI) Chairman Guruprasad Mohapatra said efforts are on to refine the norms for bidding under the scheme.

The national airport operator is the nodal agency for UDAN. “(Before) the second round of bidding, we will further refine (the scheme) after extensive stakeholder consultations,” Mohapatra told PTI in an interview. Noting that draft guidelines will be prepared before the next round of bidding, he said, “It is not necessary that terms and conditions in the first round of bidding would remain the same.”

The number of seats reserved for subsidised rates, exclusivity period given for an airline on a particular route, frequency of a particular flight and other aspects of UDAN will be looked into. “…all these questions are open for discussions,” Mohapatra said. After gathering views from the stakeholders, including states and airlines, the draft guidelines will be put up for public comments before finalising the changes. Asked whether there could be changes to the basic structure of UDAN itself, Mohapatra said there “could be”, depending on the suggestions and how realistic these are.

Also Read| UDAN scheme: Discounted tickets all booked on new Shimla-Delhi flights

The next round of bidding under UDAN is expected in three months. A senior civil aviation ministry official said the ministry is likely to come out with “simplified modalities” shortly. Some airline operators have expressed their willingness to induct aircraft with four to six or more seats and have requested subsidy to be provided for them also. So, the ministry might revise the number of subsidised seats on an UDAN flight, the official noted.
The official also said a separate round of bidding is likely for helicopters as the ministry is looking at ways to make the scheme “more feasible and attractive for helicopter operators”.

The focus is on hilly terrain in the North-East in order to improve air connectivity in that region, she added. Apart from fare cap of Rs 2,500 for one-hour flights, airlines are required to offer 50 per cent of the total seats on an UDAN flight at discounted fares. The number of such seats should be at least nine and should not exceed 40.

Besides, a carrier would have exclusivity on a particular UDAN route for three years.Among various other incentives, the participating airlines will be provided viability gap funding.

Five airlines, including an Air India subsidiary and SpiceJet, won bids to operate on 128 routes connecting 70 airports, of which 31 are unserved under UDAN. air Odisha Aviation got maximum number of 50 routes followed by Air Deccan (34) and Turbo Megha Airways (18). The AI subsidiary Airline Allied Services will operate on 15 routes while SpiceJet won bids for 11.

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