JOIN USThe Civil Aviation Ministry’s plan, Udan (Ude Desh ke Aam Nagrik), which was launched last week, is an ambitious scheme to improve regional air connectivity in the country. The first round of bidding received a good response from aviation companies. Five of them have won bids to operate 128 routes which connect 70 airports. Out of them, 31 are not connected now and others are underserved. More than a million seats will be opened up in the new routes. This is expected to have a very positive impact on economic development in the areas near the airports, tourism and allied industries. Trade and businesses will get a boost and many new jobs will be created. All the beneficiaries of the scheme are Tier 2 and Tier 3 cities which have suffered because of their isolation from the mainstream. In the country, 80% of the air traffic is between metros, and there is the need to bring the entire country on the air map.
Airlines do not provide services to smaller cities because they are not profitable. The scheme addresses this problem with a combination of incentives, subsidies and fare caps. A viability gap funding by the government will bridge the gap between the costs and tariffs which are to be kept low to attract passengers. The fares are to be subsidised with a levy on the flights on major routes which may not be very high and is to be passed on to passengers. It is proposed to raise Rs 205 crore through this. Such cross-subsidy is not a good idea but it will only be for a limited period. The Centre will offer concessional excise duty on fuel, states will charge lower taxes and provide land, and airports have agreed to waive landing and parking charges. All these might make the services economical and the spin-off effects can make the scheme more than worthwhile.
The first flight under the scheme has started operating between Shimla and Delhi. Within six months, all the proposed destination cities may become part of the aviation network. Some issues that could come up in the course of implementation may have to be tackled. The main airports from where the flights operate may become too crowded. The small airports in the destination cities maybe able to host only small aircraft, and the crew with special skills needed to operate them may have to be acquired in a short period. There maybe other operational issues also. If they are addressed successfully, the scheme can usher in the second phase of the country’s aviation revolution.