The Budget has proposed to double the outlay for the regional connectivity scheme, UDAN, to ₹1,244 crore, from the current year’s budgetary estimates of ₹601 crore.
The outlay is part of the efforts to operationalise 1,000 UDAN (Ude Desh ka Aam Nagrik) routes and to revive or develop 100 unserved and underserved landing sites such as airports, heliports, water aerodromes and advanced landing ground by 2024.
Financial minister Nirmala Sitharaman said 50 such landing sites will be revived for improving regional air connectivity. About 459 such routes involving 72 landing sites have been operationalised as on January 30, 2023.
The push for regional connectivity, which aims to provide air link to tier-II and tier-III cities through capped air fares, comes after a record rebound in India’s domestic air traffic in 2022. The number of flyers last year grew by 47% to 12.32 crore compared to 2021.
The growth comes on the back of two consecutive years (2020 and 2021) of Covid-led disruptions, where the number of flyers more than halved against 2019. While the 2022 figure is still below the pre-pandemic numbers when the total number of domestic flyers stood at 14.41 crore, as per data shared by the Directorate General of Civil Aviation (DGCA), the UDAN scheme is widely expected to spur the demand for air travel.
But not everyone is enthused by the government’s constant push to connect the unconnected. Several airlines have abruptly stopped their services on many routes perhaps due to lack of demand.
State-owned Alliance Air scrapped its maiden flight on February 1 between Sindhudurg (Maharashtra) and Mysuru as not a single ticket was sold. Alliance Air also withdrew the daily service between Mumbai and Sindhudurg to bring it down to four times a week. Both the routes are part of the UDAN scheme.
SpiceJet does not offer any flight between Varanasi and Patna, the rights for which it bagged under RCS less than three years ago.
Similarly, Star Air, which committed to operate flights between Belgaum and Nashik since January 2021, no longer offers the service on that route.
TrueJet, a 10-year-old airline, stopped operations altogether some months ago, thereby failing to provide services on the committed routes like Belgaum-Hyderabad and Belgaum-Kadapa.
Birpur Airstrip in Supaul district of Bihar figures in the tentative list of un-served airports in the UDAN scheme document. However, none of the airlines has so far submitted any proposal to operate RCS flights from Birpur, according to VK Singh, minister of state for civil aviation.
Market leader IndiGo added two destinations, Nashik and Dharamsala, over the past few days, taking the total to 78. The company believes that although new destinations do open up new markets and bring additional business, their addition is not a target in itself.
Pieter Elbers, CEO, IndiGo, said, “The number of destinations is never a target in itself. We operate where there is a market, where airports are opening, where we feel it makes sense for customers to move forward.”
According to rating and research agency ICRA, the passenger traffic from UDAN airports stood at 3.9 million in FY22, which is expected to increase to 7.5 million in FY23 (3% of overall domestic passenger traffic).
Vinay Kumar G, vice president and sector head – corporate ratings, ICRA, said, “Although the percentage contribution of traffic from UDAN airports to total traffic remains very low as most of the airports are in tier-II and tier-III cities, it has huge potential to develop the overall airport infrastructure ecosystem in India.