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UDAN - II

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April 02, 2017

Click Here to read about UDAN.

Why we need UDAN?

  • 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.
  • Bringing Tier 2 and Tier 3 into the country’s aviation network is a significant development in a country where 80% of air travel is between the metros.
  • The scheme will foster regional connectivity, make businesses and trade more efficient, enable medical services and promote tourism.

How the government convinced airlines?

  • 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 a clever 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.
  • Funding this corpus (Rs 205 crore from this levy) 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 (airport expenses constitute 25 – 30% of operating costs).

What are some of the challenges?

  • There are fears that a flight from an UDAN location will be low priority for air traffic controllers in big cities.
  • Airports in many Tier 2 and Tier 3 cities do not have big runways, so they can’t take regular aircraft.
  • That means airlines will need to induct smaller aircraft for short takeoffs and landings.
  • Such aircraft needs specialised crew.
  • India produces 200 to 300 pilots every year, and it’s safe to say that training specialised crew will take time.
  • The government should give serious thought to these issues if its well-intentioned scheme of regional connectivity is to become a success.

 

Source: The Indian Express

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