The civil aviation ministry on Friday invited bids for the fifth phase of the regional connectivity scheme, Udan or Ude Desh Ka Aam Nagrik, to improve connectivity to the country’s regional territories.
Only aircraft operations of Category 2 (20-80 seats) and Category 3 (more than 80 seats) will fall in the round with no restriction on the distance between the origin and destination, with the stage length cap of 600 km waived off. Further, the viability gap funding has been revised and increased to 600 km from 500 km earlier.
The Udan scheme is funded through a `50 levy on flight tickets on major routes. The levy accounts for 80% of the viability gap funding provided to the airlines, with the remaining 20% provided by state governments.
Under the scheme, airlines are offered viability gap funding for 50% of the seats on a flight and fares for those seats are capped by the government.
It is understood that the fifth phase of Udan will connect more than 50 wildlife and tourist destinations.
The last round (Udan 4.0) of the regional connectivity scheme was held in August 2020 when 78 routes were awarded, about 40 from the North-East region. The Airports Authority of India (AAI) listed 50 airports (including heliports) and 268 routes under operation as part of the ambitious scheme.
After the launch of the fourth phase, 766 routes were sanctioned under the scheme. 29 served, 8 unserved (including 2 heliports and 1 water aerodrome), and 2 underserved airports were included in the list for approved routes.
The aim of Udan scheme is to connect small and medium-sized cities with major cities via air service. Udan was launched to meet the common citizen’s desire of flying. Airlines compete for air routes and participate in bids. The contract is granted to an airline that bids for the lowest subsidy. The plan was to place small-town India on the map of aviation by encouraging airlines to fly on regional routes.
The main goal of the regional connectivity scheme is to make regional air connections more economical. It is also to promote affordability of regional air connectivity by assisting airline carriers through concessions from the central and state governments. It also aims to minimise the cost of regional airline operations.
The government compensates airlines for losses caused by low fares through viability gap funding. The airport fee has also been waived by the Airports Authority of India. At the same time, state governments provide free security, electricity, and firefighting services.
The government released the country’s National Civil Aviation Policy for the first time in 2016, and the Udan Scheme was the most essential component of this policy. Prime Minister Narendra Modi had launched the first aircraft from Shimla to Delhi under the Udan scheme in April 2017.