The Indian Ministry of Civil Aviation has launched the fifth round of the Regional Connectivity Scheme (RCS) - Ude Desh Ka Aam Nagrik (UDAN), following the success of four previous rounds. The aim of the scheme is to improve connectivity to remote and regional areas of the country and achieve last mile connectivity.
The Minister of Civil Aviation and Steel, Shri Jyotiraditya Scindia, commented on the launch of UDAN 5.0, stating that it has proven to be a lifeline for many regions, connecting them with places across the country. He believes this new and stronger version of the scheme will raise the momentum, connecting new routes, and bringing India closer to operationalizing 1000 routes and 50 additional airports, heliports, and water aerodromes in the near future.
Key Features of UDAN 5.0 are as follows:
- UDAN 5.0 focuses on Category-2 (20-80 seats) and Category-3 (>80 seats).
- The earlier stage length cap of 600 km is waived off and there is no restriction on the distance between the origin and destination of the flight.
- Viability gap funding (VGF) to be provided will be capped at 600 km stage length for both Priority and Non-Priority areas which was earlier capped at 500 km.
- No predetermined routes would be offered. Only Network and Individual Route Proposal proposed by airlines will be considered.
- The airlines would be required to submit an action/business plan after 2 months from the issuance of LoA wherein they submit their aircraft acquisition plan/availability of aircraft, crew, slots, etc. at the time of the Technical Proposal.
- The same route will not be awarded to a single airline more than once, whether in different networks or in the same network.
- Exclusivity will be withdrawn if the average quarterly PLF is higher than 75% for four continuous quarters, to prevent exploitation of the monopoly on a route.
- 25% of the Performance Guarantee to be encashed for each month of delay up to 4 months, to further incentivize quick operationalization.
- Airlines would be required to commence operations within 4 months of the award of the route. Earlier this deadline was 6 months.
- A list of airports that are ready for operation or would soon be ready for operations has been included in the scheme to facilitate quicker operationalization of routes under the Scheme.
- Novation process for routes from one operator to another is simplified and incentivized.
Previous success of UDAN scheme
The UDAN scheme has benefited a diverse set of stakeholders, including passengers who have enjoyed the benefits of air connectivity, airlines that have received concessions for operating regional routes, and unserved regions that have received direct and indirect benefits of air connectivity for their economic development. The scheme is a step towards the Prime Minister's vision of the common man traveling by air at affordable and subsidized airfares.