Promoting affordability of regional air connectivity is envisioned under Udan

August 1, 2023: Licensing of the Aerodrome for operationalizing RCS flights requires compliance with regulations stipulated by DGCA and BCAS. The selected Airline operator is required to obtain necessary approvals and certification from DGCA for the commencement of flights. Promoting affordability of regional air connectivity is envisioned under UDAN by supporting Selected Airline Operators (SAOs) through concessions by the Central Government, State Governments/UTs, and airport operators to reduce the cost of airline operations on regional routes and providing financial (Viability Gap Funding or VGF) support to meet the gap. The concessions offered under the scheme are as under:

Airport operators:

Airport operators will not levy Landing and Parking Charges on RCS Flights.
AAI shall not levy any Terminal Navigation Landing Charges (TNLC) on RCS Flights.
Route Navigation and Facilitation Charges (RNFC) will be levied by AAI on a discounted basis @ 42.50% of Normal Rates on RCS Flights.
Selected Airline operators (SAO) will be allowed self-ground handling for operations under the Scheme at all airports.

Central Government:

Excise Duty at the rate of 2% will be levied on Aviation Turbine Fuel (ATF) purchased by SAOs from RCS Airports for an initial period of three years from the date of notification of this scheme.
SAOs will have the freedom to enter into code-sharing arrangements with both domestic as well as international airlines.

States Government at RCS Airports within their States:

Reduce VAT to 1% or less on ATF at RCS Airports located within the states for a period of 10 years.
Provide minimum land, if required, free of cost and free from encumbrances for the development of RCS Airports and provide multi-modal hinterland connectivity as required.
Provide security and fire services free of cost at RCS Airports.
Providing or cause to be provided, electricity, water, and other utility services at substantially concessional rates at RCS Airports.
Provide a certain share (20% for States other than North-Eastern States where the ratio will be 10%) of determined VGF.

Some of the challenges affecting the establishment of airports and their operational efficiency are as under:

Delay in making land available by the State Governments.
Delay on the part of the new companies to comply with regulatory requirements
Non-availability of suitable aircraft.
Leasing issues which include long lead time for delivery of small aircraft and challenges around procuring spares from outside the country.

Some of the measures taken to address the infrastructure gaps and ensure adequate facilities for air travel in remote regions are as under:

Periodic review of all stakeholders on the progress of development/upgradation works at airports.
NSOP operations are allowed in fixed-wing seaplanes and helicopters.