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Tweak in UDAN to woo more airlines

Business Standard:  May 25, 2017

New Delhi: The government is planning to allow relaxations under its Ude Desh ka Aam Naagrik (UDAN) scheme to boost air connectivity to underserved routes. It   hopes to attract more airlines to the loss-making regional aviation sector.

The Union ministry is likely to now allow an underserved route between two regular airports. For instance, Lucknow and Varanasi: these have regular connectivity to other centres but not between themselves.

Earlier, operators were allowed to bid for services only between two underserved airports.

“A number of stakeholders and airline operators have evinced interest in undertaking operations under the scheme,” said a ministry statement on Wednesday. “Learning from the experience of first round of bidding… (the ministry) is… taking stock of regional connectivity… [to make rules] simpler and attractive.”

The ministry is also thinking of allowing operators to bid for routes between two places separated by less than 150 km, such as Ahmedabad and Vadodara (114 km).

It is looking at a number of other proposals, such as tweaking the current norm of allowing a three-year exclusivity to an airline on a route; whether the number of seats on subsidy per flight can be increased; and more flexibility for the operation of helicopters, given the limited interest by airlines in the first round of bidding. 

Civil Aviation Secretary R N Choubey said in the first round of UDAN, 72 airports had been included. Of these, 27 were classified as ‘served’, 12 as ‘underserved’ and 33 as ‘completely underserved’.

One hundred and eight new routes had been finalised and there would be 1.3 million subsidised seats available over a year. 

“This will mean a subsidy of about Rs 200 crore,” Choubey said. 

Under the UDAN, Air India, Simplifly Deccan, SpiceJet, Air Odisha and Turbo Megha (TruJet) got rights to fly 128 routes. Air India has already started regional flights while TruJet has cleared the regulatory paper work to start flights on their routes.


Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.