Shimla, Bathinda and Jaisalmer have airports. But they are not in use. The airport in Kullu gets only two flights a day. But things are poised to change with the government’s UDAN (Ude Desh Ke Aaam Nagrik) scheme getting concretised on Thursday. Five airlines have won bids to operate 128 routes, that will connect 70 airports including 31 unserved ones like Shimla, Bathinda and Jaisalmer, and 12 underserved airports like Kullu. According to the Civil Aviation Ministry, the first flight under UDAN is expected to start later this month. Bringing Tier 2 and Tier 3 into the country’s aviation network is a significant development in a country where 80 per cent of air travel is between the metros — in fact, the Bombay-Delhi sector accounts for more than 50 per cent of domestic flyers. The scheme will foster regional connectivity, make businesses and trade more efficient, enable medical services and promote tourism.
A major reason for the poor regional air connectivity in India is that airlines do not find it lucrative to operate from small cities. The government has tried to address this concern by an adroit combination of subsidies and fare caps. All the airlines that participated in Thursday’s reverse bidding for the subsidy accepted the fare caps set by the government. The money for the subsidy will be raised through a levy on flights operating on major routes like Delhi and Mumbai. The government expects an annual corpus of Rs 205 crore from this levy. Funding this corpus could mean a levy of around Rs 50 for a passenger on flights on major routes. The subsidy will be in place for three years for an airline that has won the bid on a UDAN route. There will be other benefits, including no airport charges — a significant incentive given that airline operators often complain that airport expenses constitute 25 per cent to 30 per cent of their operating costs.
