UDAN(Ude Desh Ka Aam Nagrik) Scheme is a regional airport development programme launched by Ministry of Civil Aviation. In essence, it is a component of a plan for improving regional connectivity along underserved air routes. It was designed with a 10-year implementation timeframe and was based on the revision of The National Civil Aviation Policy (NCAP)-2016.
This plan will lower costs and increase accessibility of air travel. Through this plan, small communities will be connected to major cities and air travel will become more inexpensive and cost-effective. In 2017, the program’s maiden flight departed from Shimla to Delhi flagged off by PM Narendra Modi himself.
Recently, UDAN completed it’s 5 Years of success since the launch. The fifth round of UDAN has been announced by the Ministry of Civil Aviation following the completion of four successful rounds of bidding in order to improve connectivity to the nation’s rural and regional areas and attain last mile connectivity by April 21, 2023.
UDAN: Features
There have been five phases of implementation of the scheme thus far:
UDAN 1.0: 36 additional airports were opened as part of UDAN 1.0. Five airline firms were given the rights to operate 128 flight itineraries out of 70 airports.
UDAN 2.0: The first helipad was included. 73 unserviced airports were reported in 2018.
UDAN 3.0: A number of modifications were made, including tourist routes, seaplane connections between water aerodromes, and UDAN-branded routes in the North-East.
UDAN 4.0: In 2020, 78 additional routes were authorized. The Lakshadweep islands of Kavaratti, Agatti, and Minicoy will also be connected by new routes during this phase.
UDAN 4.1: The goal of this phase is to link little airports, unique helicopter routes, and seaplane routes. Under Sagarmala seaplane services, new approaches have also been suggested.
Features of UDAN 5.0:
- Category-2 (20–80 seats) and Category-3 (>80 seats) are the main emphasis of this cycle of UDAN.
- There are no restrictions on the distance between the flight’s origin and destination, and the prior stage length maximum of 600 km is lifted.
- The maximum stage length for viability gap financing (VGF), which was previously set at 500 km, is now 600 km for both priority and non-priority sectors.
- No pre-planned routes would be provided. Only airline-proposed network and individual routes will be taken into consideration.
- After two months have passed since the LoA was issued, the airlines would be expected to present an action/business plan outlining their strategy for purchasing aircraft and the availability of slots, crew, and other resources at the time of the technical proposal.
- No airline will receive the same route more than once, whether it is inside the same network or one of the other networks.
- To avoid abuse of the route’s monopoly, exclusivity will be revoked if the average quarterly PLF exceeds 75% for four consecutive quarters.
- To further encourage prompt operationalization, 25% of the Performance Guarantee will be forfeited for every month of delay up to 4 months.
- After receiving the route award, airlines would have four months to start operating. Previously, this deadline was six months.
- To help expedite the operationalization of routes under the Scheme, a list of airports that are currently operational or will be operating shortly has been included.
- The novation process for routes between operators is streamlined and reinforced.
UDAN: Challenges
- Some states are hesitant to give up tax breaks on jet fuel (ATF) and other financial perks that might entice alternative airlines to operate in such underdeveloped areas of the state.
- Land acquisition is difficult because airports take up a lot of space. The lack of available land and large financial requirements are two problems.
- Due to the financial unavailability of the models to connect remote places, policy is reluctant.
- Poor aircraft maintenance has also been a major obstacle to properly implementing the programme on certain routes.
- Lack of reform in the AAI and DGCA laws and regulations.
- The fierce competition and high capital requirements of the aviation sector are well known. Due to the low profitability, this deters them from opening up business in locations with minimal passenger flow.
- Obtaining funding for Viability Gap Funding (VGF) is another significant difficulty.
- Due to low demand, a staggering majority of 300 routes have been impacted during the Pandemic COVID-19.
UDAN: Way ahead
- Airlines have carefully used the plan to their advantage in order to secure more slots at tier-1 airports that are already overcrowded, monopoly status on some routes, and cheaper operating costs. In order to increase the UDAN scheme’s sustainability and efficiency, stakeholders should work together.
- In order to increase the number of people who can benefit from the UDAN programme, airlines should implement marketing campaigns.
- The country-wide implementation of the programme will need more infrastructure to be successful.
- To promote the well-ordered expansion of Indian aviation, it is essential to create a competitive and profitable regional aviation environment.
- The development of airports in these regions is essential to making them operationally viable for aircraft with 70–80 seats.
