The Regional Connectivity Scheme (RCS), known as UDAN (Ude Desh ka Aam Nagrik), is a transformative initiative by the Ministry of Civil Aviation (MoCA), Government of India, to promote regional air connectivity and make flying affordable for the common citizen. This piece explores the operational guidelines, key features, and the significant impact of the UDAN scheme on India’s aviation sector.
Background of the UDAN Scheme
Prior to UDAN, air connectivity in India was largely concentrated in major metropolitan areas, leaving many regions underserved. The UDAN scheme was conceived to address this disparity and promote inclusive growth by connecting remote and regional areas with the national aviation network. The scheme aims to encourage airlines to operate flights on regional routes through incentives and enabling policies.
Key Objectives of the UDAN Scheme
The UDAN scheme has several key objectives:
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To promote regional air connectivity by making flying affordable for the common citizen.
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To encourage airlines to operate flights on regional and remote routes.
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To provide impetus to economic development in underserved regions.
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To contribute to equitable and inclusive growth across the country.
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To ensure a stable and sustainable aviation sector.
Unique Working Model of UDAN
The UDAN scheme operates through a unique working model that includes:
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Reducing Operating Costs: The government provides concessions and exemptions to reduce the operating costs for airlines on regional routes.
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Viability Gap Funding (VGF): The government provides a market-discovered subsidy (VGF) for some of the seats deployed on regional routes to make them viable.
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Exclusivity Period: The scheme provides a three-year exclusivity period to airline operators on awarded routes.
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Capped Airfares: Airfares on subsidized seats are capped at affordable rates.
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Transparent Bidding: A transparent, two-stage bidding process is used to select airline operators.
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Technology-Enabled Processes: A web-based mechanism and video conferencing are used for efficient implementation and monitoring.
Key Features of the Scheme
The UDAN scheme has several key features:
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Fiscal Support: Concessions and exemptions are provided by the central and state governments and airport operators to reduce operating costs.
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Market-Based Approach: A market-based bidding process is used to determine the subsidy level.
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Limited Government Support: VGF is provided for a limited period to allow airlines to develop routes and become self-sustainable.
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Incentives for Airlines: Airlines are incentivized to operate on regional routes through VGF and other concessions.
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Focus on Regional Connectivity: The scheme prioritizes connecting underserved and unserved regions.
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Inclusion of Diverse Routes: The scheme includes various types of routes, such as helicopter, seaplane, and tourism routes.
Evolution of the UDAN Scheme
The UDAN scheme has evolved over the years, incorporating various modifications:
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UDAN 2: Enhanced focus on hilly areas, North-Eastern, and island states.
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UDAN 3: Inclusion of seaplane operations and tourism routes.
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UDAN 4: Enhancement of VGF support for smaller aircraft and focus on shorter routes.
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Lifeline UDAN: Facilitated the movement of essential medical cargo during the COVID-19 pandemic.
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Krishi UDAN: Provided subsidies for transporting agricultural products, benefiting farmers.
Implementation of RCS-UDAN
The implementation of RCS-UDAN involves:
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Transparent Bidding: A two-stage e-bidding process to invite proposals and counter-proposals.
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Stakeholder Consultation: Regular consultations with airlines, state governments, and other stakeholders.
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Monitoring: Periodic monitoring of airport infrastructure and training of security personnel.
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Robust Governance: A transparent financial management system and a dedicated committee for monitoring.
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Interface with Airlines: Use of the Airport Information Management System (AIMS) for data management and billing.
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Simplified Regulations: Simplified licensing and security procedures for airports, heliports, and water aerodromes.
Notable Outcomes of UDAN
The UDAN scheme has achieved several notable outcomes:
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Increased Connectivity: Work has been initiated to provide scheduled connectivity to 104 unserved/underserved airports, 36 heliports, and 14 water aerodromes.
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Operational Routes: 389 routes connecting 54 airports, 2 water aerodromes, and 6 heliports have been operationalized.
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Passenger Growth: Over 7.8 million passengers have availed the benefits of the scheme.
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Economic Impact: The scheme has a positive impact on the economy, generating employment and promoting regional development.
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Lifeline UDAN Impact: 588 flights transported approximately 1000 tonnes of essential cargo during the pandemic.
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Krishi UDAN Impact: Approximately 70,000 MT of agricultural products have been transported through the scheme.
Conclusion
The UDAN scheme has emerged as a transformational policy that has significantly impacted India’s aviation sector. By promoting regional air connectivity, making flying affordable, and supporting airline operators, the scheme has contributed to economic growth, social inclusion, and improved accessibility across the country. Its adaptability and responsiveness to changing needs have made it a resilient and effective tool for national development.