To enhance regional connectivity with unserved and underserved airports in the country through fiscal support and infrastructure development, the Regional Connectivity Scheme-UdeDesh ka AamNaagrik (RCS-UDAN) was launched in October 2016. The aim of the scheme is to make air travel affordable for all. As of February 28, 2023, 469 routes connecting 74 unserved and underserved airports, including nine heliports and two water aerodromes, have been operationalised.
Funds allocation and disbursement
In Union Budget 2023-24, funds worth Rs 12.44 billion have been earmarked for RCS-UDAN, an increase of 15.3 per cent over the revised allocation of Rs 10.79 billion for 2022-23. The government has also set a target to revive 50 additional airports, heliports, waterdromes and advanced landing grounds for improving regional air connectivity.
Meanwhile, viability gap funding (VGF) of around Rs 24.54 billion has been released to select airline operators (SAOs) as of March 7, 2023 for the operation of UDAN flights across the country. To meet the liability of higher VGF outgo to SAOs as a result of the increased operationalisation of UDAN routes, the Ministry of Civil Aviation (MoCA) has revised the RCS levy to Rs 10,000 from January 1, 2023 and to Rs 15,000 from April 1, 2023 up to April 30, 2027. Further, airlines are free to pay the levy as per the mechanism devised by them.
Update on new RCS-UDAN rounds
MoCA aims to connect more than 50 wildlife and tourist destinations under the next round, that is, UDAN 5.0. So far, the government has identified 54 non-operational airstrips that are in close proximity to tourist, wildlife or religious destinations. The two-stage bidding process is expected to offer more flexibility to interested airlines in route selection.
RCS-UDAN is an ongoing scheme under which bidding rounds are conducted periodically for covering more routes and destinations. Bids under UDAN 4.2, incorporating the provisions of the new small aircraft sub-scheme, were invited in April 2022. The aim of UDAN 4.2 is to enable last-mile connectivity by establishing a system for smaller planes and helicopters with a capacity of 19-20 seats. Approximately 370 routes have been included under UDAN 4.2, of which 100 are seaplane routes, 60 are helicopter routes and the remaining are fixed wing routes.
In a major milestone, 50 new RCS routes commenced operations between January 1, 2022 and December 8, 2022 and 140 new RCS routes were awarded under UDAN 4.2 and 4.3. Five airports/heliports – Keshod, Deoghar, Gondia, Jeypore and Almora (heliport) – were operationalised and 16 new airports/heliports/water aerodromes were identified under UDAN during the same period.
Air connectivity to the north-eastern states
MoCA has taken initiatives to give an impetus to air connectivity to remote areas in the north-eastern states, which have inadequate rail and road connectivity. As of December 8, 2022, 18 RCS-UDAN routes are operational in the north-eastern region of the country. In a recent development, on February 8, 2023, Pawan Hans Limited commenced helicopter services on six routes in Assam. It has deployed one twin-engine Dauphin Helicopter with a seating capacity of up to 11 passengers. These new helicopter services launched under RCS-UDAN will provide air connectivity on the Dibrugarh-Jorhat-Tezpur-Guwahati-Tezpur-Jorhat-Dibrugarh network. The services will also play a key role in promoting tourism in Assam.
Some of the challenges faced in implementing the scheme are the adverse impact of the Covid-19 pandemic, the non-readiness of civil airports/heliports (owing to the lack of availability of land, creation of regional infrastructure, etc.), non-sustainability of operations on the awarded routes, and non-readiness of SAOs.
The scheme has succeeded in providing air connectivity to Tier II and Tier III cities at affordable fares and has transformed the way people travel. Going forward, the government is planning to develop 100 airports by 2024 to support RCS-UDAN. Further, 220 airports/heliports/water aerodromes under UDAN are targeted to be completed by 2026, with 1,000 routes being operationalised to provide air connectivity to unconnected destinations in the country.