In a bid to make flying affordable for masses and to provide better air connectivity to smaller towns, the government launched the Ude Desh ka Aam Nagarik or UDAN scheme in April 2017. In its third phase, the government has received initial bids for 111 routes from 15 airlines. In the first phase, five airlines were given the mandate to fly on 128 routes and in the second phase, 15 airlines could fly on 325 regional routes. But the scheme has run into some choppy weather with licenses being cancelled, most of the routes yet to reach critical mass and only half of the 70-odd airports that were to be part of the scheme connected. While part of the slow progress can be attributed to infrastructure delays, a lot of it has to do with the fact almost eight regional players including Air Odisha, Air Carnival, Zoom Air and Air Costa have gone belly up. Air Deccan hasn’t flown since October 2018. Since its launch, about 450,000 people have been flown under the UDAN scheme where airfares are capped at Rs.2,500 for an hour-long journey through subsidised tickets. A recent CAPA report stated that the regional connectivity scheme needs to restructured to make it viable and the success of UDAN largely depends on the increased participation by established and incumbent operators. According to CAPA, there is little or no business case for small and regional operators without scale. And that definitely seems to be the case with established players such as SpiceJet, IndiGo and Alliance Air expanding their network under the regional connectivity scheme and TruJet being the only regional airline still flying under the UDAN scheme.
Running into rough weather
Even as it enters its third phase, UDAN is a long way from delivering on its promise of better connectivity
Published 2 years ago on Jan 11, 2019 • Read