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New Delhi: In the hope of providing air connectivity to parts of India where it does not exist, the government had launched the Regional Connectivity Scheme (RCS), more popularly known as UDAN — Ude Desh Ka Aam Naagrik — in April 2017. But, nearly four years on, just 41 per cent — or 325 routes — of the 778 routes awarded until now have been operationalised.

Reasons vary from lack of infrastructure at the RCS airports, heliports and seaports; regulatory issues and failure of some airlines to unsustainability of the awarded routes because of very low demand.

The Covid-19 outbreak, which put India under the world’s strictest lockdown for two months, dealt a further blow.

Since its inception, the scheme — for which four rounds of bidding have been conducted — has given rise to over 130 new city pairs connecting 105 airports, benefitting 5.9 million passengers and has had a 70 per cent average load factor on the regional routes.

Eleven airlines have begun operations under the UDAN scheme, of which four are start-ups. As many as 56 UDAN airports, including two water aerodromes and five heliports, have been developed and operationalised.

The scheme has also become a game-changer for several unserved and under-served areas such as Jorhat, Kalaburagi, Darbhanga, Nashik by ensuring air connectivity and by consequence, regional growth.


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Very low demand, lack of infrastructure & failing airlines

Since its commencement, the UDAN scheme has faced several challenges in implementation. Readiness of airports, seaports and heliports has emerged as a key concern.

“At some of the RCS airports, additional land is required for development or upgradation and is to be provided by the state government or Union Territories free of charge and free from all encumbrances,” Civil Aviation Ministry spokesperson Rajeev Jain told ThePrint.

In the scenario where the state doesn’t have land, it has to acquire it, which is a time-consuming process. Also many of the far-flung regions, which did not have air service until now and are to be covered under the UDAN scheme, have difficult terrain.

“Due to this, licensing, special attention and technical capacity is required, which has proved to be another major constraint,” a senior official in the civil aviation ministry said. “Insufficient runway lengths also restricts certain airports from receiving regional flights.”

SpiceJet — the largest player in the scheme, operating 63 daily flights that connect 15 domestic destinations with key metros — was unable to start certain routes for these reasons. “We could not start a few routes which were awarded under RCS and the major issue was airport infrastructure, including airport readiness and smaller runways having operational issues,” an airline spokesperson told ThePrint.

Underlining the unsustainability of certain routes, the senior aviation ministry official added, “Some of these (routes) are very low passenger demand, (while) adverse and unpredictable weather conditions at remote areas don’t allow consistent operations.”

Availability of airline slots at some metro and Tier-1 airports is another major concern.
“Some of the small airlines that have won bids under RCS-UDAN could not mobilise sufficient funds and human crew resources and as a result they could not commence the RCS operations on awarded routes,” the official said. Due to this, certain awarded routes were cancelled.

According to the official, the suspension of Jet Airways also led to the cancellation of routes that the airline was flying to, while those awarded to it in January 2019 during UDAN 3.0 were not even operationalised.

Covid-19 impact on UDAN

The coronavirus induced lockdown halted the development of RCS airports and delayed acquisition of aircrafts by the selected airline operators.

“Adapting to the unprecedented situation, certain flexibilities and reliefs were introduced to help airline operators along with certain economising measures to rationalise the Viability Gap Funding (VGF) outflow,” Jain said. VGF is the financial support provided to an airline operating on an RCS route through the Regional Connectivity Fund.

“The suspension of domestic operations for two months, followed by a very low scale of operations post restart impacted the collection of the levy, which led to reduction in VGF support post-Covid thereby impacting the viability of some of the routes,” Sanjay Kumar, Chief Revenue & Strategy Officer, IndiGo, told ThePrint.

IndiGo has been awarded 37 UDAN routes of which 26 are operational while the rest are scheduled to be operational by next month. Moreover, few more routes were awarded to the airline under UDAN 4.0, which will be operational in the coming few months.
SpiceJet also reported a drop in overall demand owing to Covid.

Boost needed for regional travel and airlines

India’s regional aviation market has been a slew of failures. According to a report prepared by CAPA India, an airline research and advisory firm, on regional aviation in November 2020, the nation’s regional fleet consists of just 80-90 aircraft.

Reasons for the failure in this sector vary from under-capitalisation, operation of old equipment and reliability challenges to poor governance, the report states.

“Developing a competitive and viable regional aviation ecosystem is critical to support the orderly growth of Indian aviation. This applies to both airlines and airports,” the report — accessed by ThePrint — notes. The UDAN scheme, CAPA believes, democratised air travel in India.

However, for the success of UDAN, a “strategic review of regional aviation in India and a re-targeting of planned investment” is required.

“Most important is the need to develop airports in these areas to make them operationally feasible for 70-80 seater aircraft,” IndiGo’s Kumar said. “The government should also ensure accessibility of these airports from nearby catchment areas. Taxes on fuel need to be reduced, which has been a demand in the industry for a long time.”

UDAN 4.1 by second half of 2021

Focusing on development of required infrastructure at airports, heliports and water aerodromes, allowing operational flexibility through and providing additional VGF to small aircraft to improve the viability, among others, are some of the steps the ministry has taken to operationalise pending routes.

“The Civil Aviation Ministry is launching a special round of UDAN 4.1 in respect of cancelled and non-operationalised routes by the second half of this year,” a senior official in the ministry told ThePrint.

Under UDAN 4.1, which will cover cancelled and terminated routes besides new destinations, 392 routes have been proposed, bidding for which is expected to be complete in six weeks.


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1 COMMENT

  1. Commendable step by the Modi govt. It shows that it is a working govt., working for the people… working for the country.
    What the UDAN achieved in 4 years is no small feat. In coming years it will provide the much needed boost to regional air connectivity in the country.

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