Udan: SpiceJet, Alliance Air may fly on regional routes
NEW PATH Five airlines set to get licence; formal announcement likely today
An ambitious scheme aimed to open and expand subsidised flights to remote airports is close to take-off with the government ready to release the names of routes and airlines that have qualified for the same.
Aviation minister Ashok Gajapathi Raju will shortly name the airlines and routes under the first phase of the Udan regional connectivity scheme (RCS), officials in the ministry and the Airport Authority of India said, on condition of anonymity. The scheme will run for 10 years.
“We have received close to 43 proposals from scheduled and non-scheduled operators, of which five airlines are likely to get a licence,” said an AAI official. He declined to name the airlines. However, another AAI official, said low-cost carrier SpiceJet Ltd and Air India Ltd subsidiary Alliance Air Ltd were in the list. “The minister will announce all the work orders (for the new airports) and the airlines formally on March 30,” he said.
The first phase will include 45 airports and about 70 odd routes. “We get six months from the date of bids to make the airport fit for flying,” said the first official cited earlier. While the airports owned by AAI are ready, work is pending on those owned by state-run companies such as Steel Authority of India Ltd and some others by private companies. AAI officials will meet in the first week of April to gauge the level of preparedness of its airports.
Deploying air navigation services — a bunch of services provided to aircraft to enable safe and efficient flight from one destination to another — at new airports will be a major task. AAI has invited bids from mobile tower companies for airports where the facility is not readily available, said the second AAI official cited above.
The regional connectivity model is based on viability gap funding, under which 80% of the cost will be borne by the state government and the rest by the Centre. The subsidies will be offered for three years. Under the scheme, the fare for a one-hour journey of about 500km on a fixedwing aircraft or a 30-minute journey on a helicopter will be capped at ₹2,500, with proportionate pricing for routes of different lengths and duration.
In order to make operations on such routes financially viable, the central government will provide concessions in the form of reduced excise on value-added tax, or VAT, service tax and flexibility in code sharing at airports under the regional connectivity scheme.