Focus: GS-III Industry and Infrastructure
Why in news?
78 new routes under the 4th round of Regional Connectivity Scheme (RCS)- Ude Desh Ka Aam Nagrik (UDAN) have been approved following the three successful rounds of bidding by the Ministry of Civil Aviation.
What is UDAN scheme?
- UDAN is a regional connectivity scheme spearheaded by the Government of India (GoI). The full form of UDAN is ‘Ude Desh ka Aam Nagarik’ and aims to develop smaller regional airports to allow common citizens easier access to aviation services.
- This scheme is a part of the National Civil Aviation Policy (NCAP) and is funded jointly by the GoI and the state governments.
The following are its salient features:
- The scheme duration is for 10 years
- Airlines participating in UDAN are selected through a competitive bidding process
- The Central government will provide the following:
- Subsidy to cover Value Gap funding (VGF) for participating airlines
- Concessional GST on tickets booked using the scheme
- Codesharing for flights under the policy
- State Governments will extend the following measures:
- GST reduction to 1% for 10 years
- Coordination with oil companies to facilitate refuelling facilities
- Provide land for airport and ancillary development
- Trained security personnel
- Utilities at subsidised rates
- 20% of VGF
- Airport operators such as AAI will provide the following concessions:
- No parking, landing and storage charges at participating airports
- Nil TNLC (Terminal Navigation Landing Charges)
- Allow ground handling by the airline selected through the bidding process
- RNCF (Route Navigation and Facilitation Charges) will be discounted to 42.4% of normal rates by the Airports Authority of India
Value Gap Funding is not provided to cargo airlines. All other terms and conditions remain the same as passenger airlines. The fares are graded based on distance and flight hours for both fixed-wing and rotary-wing services. The RCS subsidy is funded by a levy of Rs 5000 per flight on major routes. Flights regulated under this policy framework can be booked from the UDAN website and major travel portals by passengers.