There is likely to be a revision to the minimum number of seats on which the Government will provide subsidy to an airline for operating to airports in tier-II and tier-III cities under the regional air connectivity scheme of the Government.
The regional air connectivity scheme, popularly called UDAN (Ude Desh Ka Aam Naagrik), seeks to give people in tier-II and III cities an opportunity to fly at a ticket price of ₹2,500. Airlines operating under the UDAN scheme have to ensure that at least 50 per cent of the seats on their flights are available at a price of ₹2,500 for an hour of flying. The Centre and state provide viability gap funding for airlines operating on the UDAN routes to ensure profitability of these flights.
At the moment an airline operating under UDAN is entitled to subsidy on a minimum of 9 and a maximum of 40 seats on a flight. The new thinking in the Government comes after requests from operators that they were willing to induct aircraft having four to six or more seats and requesting that subsidy be provided for these flights also.
These changes are among those being considered when the Government calls bids from various airlines for operating on more routes under UDAN. The second round of bidding for these routes is expected towards the end of June this year, although officials from the Ministry of Civil Aviation admitted that meeting the end-June deadline to start the bidding process might be difficult.
The second round of UDAN will also see the Government drop some airports, including Juhu in Mumbai, and Jalandhar. Explaining the rationale behind dropping Jalandhar, a senior Ministry official said this is being proposed as there was not much traffic from there. Besides a better airport existed at Adhampur, which was close to Jalandhar.
The first round of bidding ended in March this year with the Government awarding five airlines — Air Odisha, Air Deccan, Alliance Air, SpiceJet and Trujet — the right to operate UDAN flights.