The top 50 shortlisted airports will be incorporated in the next phase of the Regional Connectivity Scheme.
The latest shift in the government’s stance follows realisation of a below-par performance of the first phase, with commercial flights discontinued on nearly half the routes.
First launched in 2017, the ambitious Ude Desh ka Aam Nagrik (Udan) scheme was aimed at fuelling a nationwide expansion of air travel in one of the world’s fastest-growing aviation markets. Under the scheme, the government caps airfares and in lieu, offers incentives, including subsidies, to attract airlines to less-traversed routes.
The second phase, announced by Prime Minister Narendra Modi earlier this month, boosted the outlay sixfold to ₹28,840 crore.
Adequate Aircraft Rule
“There have been learnings from the first phase, where airlines were unable to commence operations as airports weren’t ready,” said a government official. “There are also cases where destinations never became viable and dropped off the network as soon as the subsidy period was over. Hence, the new scheme sets strict standards for airport selection so that only those with chances of sustained air connectivity are included.”Several regional airports, developed with government funding, eventually turned into burdensome projects after airlines ceased operations. Kushinagar Airport in Uttar Pradesh for instance, developed at a cost of ₹448 crore, has had no commercial flights since 2023.
In the scheme’s second phase, the government has also mandated that routes will be awarded only to airlines having adequate aircraft, unlike previously, when a carrier without an air operator permit was allowed to bid.
“Many smaller airlines bid for routes beyond their operational capability, sometimes without even receiving an operating permit,” said the official cited above. “This led to routes that were never started. Hence, we have restricted the eligibility criteria.”
During the last bidding round in 2024, an entity called Jettwings Airways, which had submitted a plan to induct 42 aircraft over five years and was awarded a dozen routes, eventually never commenced operations.
The government will also push airports in major cities to allocate landing and take-off slots to smaller carriers, in the second phase, after regional airlines flagged that operations became unviable when they couldn’t access privately-owned metro airports.
“Major gateway airports like Delhi and Mumbai should support regional carriers for the scheme to have full impact,” said Manoj Chacko, MD and CEO of Fly91, which operates a six-aircraft fleet connecting Udan airports such as Sindhudurg and Jalgaon. “To develop a viable network, it is important for an airline of my size to have connectivity with a major airport.”