Regional Connectivity Scheme Current Affairs

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PM launches UDAN Scheme

Prime Minister Narendra Modi has launched the UDAN (Ude Desh Ka Aam Nagrik) scheme from Jubbarhatti, an airport on the outskirts of Shimla. ‘Ude Desh Ka Aam Nagrik’ means ‘the common man flies’. He flagged of the first UDAN flight under Regional Connectivity Scheme (RCS) on Shimla-Delhi sector. UDAN flights on Kadapa–Hyderabad, and Nanded-Hyderabad sectors were also flagged off.

Salient Highlights

Around 45 unserved and under-served airports are set to be connected under UDAN scheme to make flying more affordable. The airports to be connected under UDAN include Bhatinda, Bhavnagar, Durgapur, Jaisalmer, Puducherry, and Shimla.

Under this scheme, five operators will operate flights services on 128 routes that will connect 70 airports through 19-78 seater aircrafts. The operators are Air India subsidiary Airline Allied Services, Air Deccan, Air Odisha, Turbo Megha, and Spice Jet.

As per the modalities of the scheme, airfare for a one-hour journey of 500 km has been capped at an all-inclusive charge of Rs. 2,500. For longer routes and flight duration, the pricing will vary. A single person will be entitled to buy 9 to 40 seats in a flight. However, only 50% of the seats will be sold at Rs 2500 per seat per hour. The airlines can sell the rest of the tickets at market rates.

Significance

UDAN scheme will make flying easier and affordable for the common man. It is hailed as the first-of-its-kind scheme globally to stimulate regional connectivity through a market-based mechanism. UDAN network will cover the whole country. Accordingly, 24 airports in the western region, 17 airports in the northern region, 11 in the southern region, 12 in east and 6 in north-eastern parts of the country are proposed to be connected under UDAN. The scheme is expected to have positive effects on the economy in terms of employment and investment. The scheme will also promote tourism and balanced regional growth.

UDAN

The ‘Ude Desh ka Aam Naagrik’ RCS (Regional Connectivity Scheme) was launched in October 2016. It is considered as a vital component of the National Civil Aviation Policy (NCAP) which was released on June 15, 2016.

The scheme has been launched to provide connectivity to un-served and under-served airports of the country through revival of existing air-strips and airports. This is first of its kind scheme and will be implemented for a period of 10 years. As of now, 128 routes have been identified and declared in the RCS map of India. The key objective of the UDAN scheme is to provide regional connectivity so that persons in regional towns are able to take affordable flights.

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Government announces regional aviation routes and airlines under UDAN scheme

The Union Civil Aviation Ministry has announced regional aviation routes and airlines after the first round of bidding under UDAN (Ude Desh ka Aam Naagrik) Scheme.

In the first round, as many as 128 routes connecting 70 big and small airports across the country were selected and all flights will become active within 4-6 months.

Key facts
  • The airlines selected under this round are SpiceJet, Air India subsidiary Alliance Air and regional airlines Turbo Megha Airways, Air Deccan and Air Odisha Aviation
  • Some of the inactive airports selected are Shimla, Bikaner, Agra, Gwalior, Rourkela, Kadapa, Jharsuguda, Vidyanagar, Burnpur, Kullu, Diu, Mysore, Shillong, Jagdalpur, Salem, Utkela, and Hosur.
  • The regional airlines will connect these destinations with their nearest bigger airports such as Delhi, Chennai, Bhubaneswar, Bengaluru, Ahmedabad, Mumbai and Jaipur, among others.

UDAN Map

About UDAN Scheme

  • UDAN is an innovative scheme to develop the regional aviation market. It is a market-based mechanism in which airlines bid for seat subsidies.
  • Under this scheme, half of the seats on the plane will be capped at Rs. 2,500 per hour’s flight. Government will subsidise the losses incurred by airlines flying to dormant airports by charging Rs. 2,500 per hour’s flight.
  • 80% of the subsidy will be collected by charging a levy of up to Rs. 8,500 on each departing flight of domestic airlines and the rest 20% will come from the respective State governments.
  • Government will provide subsidy to airlines for first three years of operations when they will have exclusive flying rights on the selected routes.
  • Once the market in these routes gets jump started, it will operate on a commercial basis as per market forces of supply and demand.
Comment

UDAN is first-of-its-kind scheme globally that aims to create affordable yet economically viable and profitable flights on regional routes. It will also strive to make flying affordable to the common man even in small towns. The scheme will help to stimulate growth (in terms of employment and investment) in the regional aviation market and connect underserved and unserved airports in the hinterland areas that were not having flight services.

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AAI receives 45 initial bids under Regional Connectivity Scheme

The Airports Authority of India (AAI) has received 45 initial bids from 11 parties to fly routes under the Regional Connectivity Scheme (RCS) launched by the Union Ministry of Civil Aviation.

The initial bid proposals covers more than 200 routes and as many as 65 airports, 52 of them not served by any airline and 13 under-served airports. Now, Government has invited counter-bids against these initial proposals.

After that, these routes will be awarded to bidders who quote the lowest Viability Gap Funding (VGF) requirement against the routes under the RCS.

About Regional Connectivity Scheme (RCS)

  • The RCS aims to boost air travel in Tier II and Tier III cities by capping fares at Rs 2,500 per one hour flight. The AAI is the implementing authority of the scheme.
  • Its objective is to make flying affordable for the masses, to promote tourism, increase employment and promote balanced regional growth.
  • As per the scheme, the Union Government will subsidise the losses incurred by airlines flying out of dormant airports to allow airlines to charge Rs. 2,500 for an hour’s flight to passengers.
  • About 80% of the subsidy will be collected by charging a levy of up to Rs. 8,500 on each departing flight of domestic airlines and the rest 20% will come from the respective state governments.

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