Turbulence Hits UDAN Scheme, 50% Routes Grounded
26-08-2023
01:24 PM
1 min read
What’s in today’s article?
- Why in News?
- About Regional Connectivity Scheme – UDAN
- Funding Pattern for UDAN Scheme
- Performance of UDAN Scheme
- News Summary
Why in News?
- Out of the 479 airport routes that were revived by the Union Government, under the Regional Connectivity Scheme, 225 have ceased operations.
About Regional Connectivity Scheme – UDAN
- UDAN (Ude Desh Ka Aam Naagrik) is a regional connectivity scheme launched by the Government of India, as a part of the National Civil Aviation Policy in 2016.
- UDAN, which will be in operation for a period of 10 years (2016-26), envisages providing connectivity to un-served and underserved airports through revival of existing airports and air strips.
- The objective of the scheme is to take flying to the masses by improving air connectivity for tier-2 and tier-3 cities, and subsidising air travel on these routes.
- The routes are awarded after a bidding process, and the winning airlines are given certain incentives, along with viability gap funding (or a subsidy) equivalent to 50% of the seating capacity on their aircraft.
- In return, the airlines sell 50% of their seats at a flat rate of Rs 2,500 per hour of flight, in order to make air travel affordable.
- Implementing Agency: Airport Authority of India (AAI)
Funding Pattern for UDAN Scheme
- Regional air connectivity is envisioned under the UDAN scheme by supporting airline operators through:
- Concession by Central Government, State Governments/UTs and airport operators to reduce the cost of operations on regional routes; and
- Financial Viability Gap Funding (VGF) support to meet the gap, if any, between the cost of airline operations and expected revenues on such routes.
- VGF will be shared between Ministry of Civil Aviation and the State Government in the ratio of 80:20 whereas for the States in North-Eastern region/UTs the ratio will be 90:10.
Performance of UDAN Scheme
- Thus far, RCS – UDAN scheme has gone through different phases in which new flight routes and airports/airstrips have been added under the program:
- UDAN 1.0:
- 5 airlines companies were awarded 128 flight routes to 70 airports.
- UDAN 2.0:
- In Phase 2, helipads were also connected.
- In this phase, Central government awarded contracts to 15 airliners to operate in 325 routes across hilly, remote areas.
- It involved connecting 56 new airports and helipads to 36 existing aerodromes, as per the Ministry of Civil Aviation.
- UDAN 3.0:
- Inclusion of Tourism Routes under Phase 3 in coordination with the Ministry of Tourism.
- Inclusion of Seaplanes for connecting Water Aerodromes.
- Bringing in a number of routes in the North-East Region under the ambit of UDAN.
- UDAN 4.0:
- Phase 4 of the scheme was launched in December 2019 with a special focus on North-Eastern Regions, Hilly States, and Islands.
- UDAN 4.1:
- Launched in March 2021, the UDAN 4.1 round is focused on connecting smaller airports, along with special helicopter and seaplane routes.
- In addition to these, some new routes have been proposed under the Sagaramala Seaplane Services in consultation with the Ministry of Ports, Shipping, and Waterways.
- UDAN 5.0:
- Launched in April 2023, the UDAN 5.0 round is focused on Category-2 (20-80 seats) and Category-3 (>80 seats) aircrafts.
- There is no restriction on the distance between the origin and the destination of the flight.
- Airlines would be required to commence operations within 4 months of the award of the route; earlier this deadline was 6 months.
- UDAN 1.0:
- Since the launch of modern civil aviation in India in 1911, only 76 airports had been connected by scheduled commercial flights.
- The number of operational airports has gone up to 141 from 76 in 2014.
- With 479 new routes initiated, UDAN Scheme has provided air connectivity to more than 29 States/ UTs across the country.
- More than one crore passengers have availed the benefits of this scheme.
News Summary
- Out of the 479 airport routes that were revived by the Union Government, under the Regional Connectivity Scheme, 225 have ceased operations, according to the Ministry of Civil Aviation’s response to questions from The Hindu.
- Of the 225 routes that have ceased operations, 128 routes shut down even before completing the mandatory three-year period under the scheme.
- Airlines found 70 of these routes to be commercially unviable despite the subsidy, while the remaining 58 have been cancelled either due to “non-compliance” by the airline operator, or the airline surrendering routes, or the airline companies shutting down.
- As many as 97 routes shut down after completing the three-year period during which the government provides support.
Q1) What is the main function of the Directorate General of Civil Aviation?
The Directorate General of Civil Aviation (DGCA) is the regulatory body in the field of Civil Aviation, primarily dealing with safety issues. It is responsible for regulation of air transport services to/from/within India and for enforcement of civil air regulations, air safety, and airworthiness standards.
Q2) Is Airport Authority of India a statutory body?
The Airports Authority of India was created through the Airports Authority of India Act, 1994 under the aegis of the Ministry of Civil Aviation. Hence, it is a statutory body.
Source: Turbulence hits UDAN scheme, 50% routes grounded | AAI