14 Nov 2024        10:40:53 am

Government Schemes

UDAN Scheme

Tags : UDAN Scheme

Topic: Infrastructure

Why in the news?

• Government to extend the UDAN scheme for 10 years, targets 350-400 airports by 2047.
• Since its launch in October 2016, the scheme has operationalised 601 routes and 71 airports, facilitating travel for over 1.44 crore passengers.

Source: The Hindu Business Line

About UDAN Scheme (Ude Desh ka Aam Naagrik):

• It is a regional airport development and Regional Connectivity Scheme (RCS) of the Union Government of India which aims to provide connectivity to un-served and under-served airports of the country through the revival of existing airstrips and airports.
• Components:
  • Enhancement and Expansion of Airports: The initial component of the UDAN Scheme involves the improvement of existing airports and the establishment of new ones, ultimately fostering swifter regional connectivity.
  • Capped Airfare and Sustainable Routes: The second component includes introduction of new, capped airfare and the establishment of financially viable regional routes. This initiative aims to enhance accessibility and economic sustainability in underserved regions.
• Objectives:
  • Enhancing Accessibility Through Affordable Airfare- Focused on creating economically viable and profitable flights on regional routes to make air travel affordable for the common man, even in small towns.
  • Catalyzing Mass Connectivity through UDAN- Aiming to stimulate regional air connectivity and ensure accessibility to air travel for the broader population through strategic measures.
  • Revitalizing Un-Served and Underserved Airports- Envisioning the revival of un-served and underserved airports across the country by rejuvenating existing air-strips and airports, with the scheme operational for a duration of 10 years.
  • Market-Driven Expansion of UDAN- Operating as a market-driven scheme, UDAN conducts periodic bidding rounds to expand coverage, encompassing more destinations, stations, and routes for sustained growth.
  • Airlines’ Strategic Role in UDAN Bidding- Illustrating the crucial role of interested airlines in the UDAN scheme, where they assess demand for specific routes connecting airports and submit proposals during bidding rounds.
  • Inclusive Economic Growth through Rapid Connectivity- Dedicated to fostering inclusive economic development by accelerating connectivity, leading to widespread economic empowerment.
  • Advancing Air Transport Infrastructure in Remote Regions- Strategic initiatives aimed at advancing air transport infrastructure in remote areas, contributing to comprehensive regional development.
• The UDAN Scheme is a key element of the National Civil Aviation Policy (NCAP) which was released by the Ministry of Civil Aviation (India) in 2016.
• It is bolstering connectivity in remote and regional areas of the country, addressing critical aspects of national infrastructure development.
• It is ensuring affordability in air travel, aligning with broader goals of inclusivity and economic development..
• Nearly 50% of seats on Udan flights are offered at subsidized fares under the scheme.
• Participating carriers receive Viability Gap Funding (VGF), an amount shared between the central government and the concerned states.
  • It supports infrastructure projects that are economically justified but fall marginally short of financial viability.
  • VGF will be shared between the Ministry of Civil Aviation and the State Government in a ratio of 80:20.
  • In case of the North-Eastern states and Union Territories, the VGF sharing ratio will be 90:10.
• The scheme is jointly funded by the central government and state governments to support its implementation.
• It is designed to run for a period of 10 years. There is provision for the scheme’s extension beyond the initial 10-year period.

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