UDAN Scheme 2.0 revamped : Boosting Regional Air Connectivity in India

Why in News ?

The Union Cabinet has approved a revamped UDAN Scheme, increasing funding and extending subsidy support to strengthen regional air connectivity across India.

Background and Context

India’s aviation sector has witnessed rapid growth, but connectivity remains uneven :

• Metro cities are well-connected
• Tier-2 and Tier-3 cities lag behind

To address this imbalance, the government launched the UDAN Scheme in 2017 under the Regional Connectivity Scheme (RCS).

About UDAN Scheme

• Full form : Ude Desh ka Aam Nagrik
• Launched in : 2017
• Nodal Ministry : Ministry of Civil Aviation

Objectives

• Enhance connectivity to : Underserved and unserved regions
• Make air travel : Affordable for common citizens
• Promote : Balanced regional development
• Improve : Utilisation of idle airports

Key Features

1. Competitive Bidding

• Airlines selected through : Transparent bidding process

2. Viability Gap Funding (VGF)

• Financial support to : Airlines operating unprofitable routes

3. Affordable Airfare

• 50% seats capped at : ~₹2,500 per hour of flight

4. Focus Areas

• Remote and difficult regions : 
  • North-East
  • Hilly areas
  • Islands

Funding Mechanism

• Funded through: Levy on major air routes
• Purpose: Cross-subsidisation of regional routes

Achievements of the Scheme

• Over 600 routes operationalised
• More than 90 airports revived
• Enhanced connectivity in : 
  • North-East
  • Remote and hilly regions

Need for Revamp

Despite successes, several issues emerged :

• Low financial viability post-subsidy
• Limited passenger demand
• High route discontinuation rate
• Infrastructure gaps

Key Features of the Revamp

• Increased funding support
• Extended subsidy duration
• Focus on : 
  • Sustainability of routes
  • Strengthening regional demand

Significance of the Revamp

1. Regional Development

• Boosts: Economic activity in smaller cities

2. Inclusive Growth

• Makes aviation accessible to: Wider population

3. Infrastructure Utilisation

• Revives: Idle airports and airstrips

4. Tourism Promotion

• Enhances access to : 
  • Remote tourist destinations

5. Strategic Connectivity

• Strengthens : 
  • Connectivity in border and remote areas

Challenges

• Financial sustainability of airlines
• Demand generation in remote regions
• Infrastructure bottlenecks
• Dependence on subsidies

Way Forward

• Develop : Regional economic hubs to boost demand
• Strengthen : Airport infrastructure
• Encourage : Private sector participation
• Improve : Last-mile connectivity (road/rail integration)
• Gradually reduce subsidy dependence