Udan: More airlines likely to participate in Round 2 of regional connectivity scheme

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(From left) Civil aviation secretary R.N. Choubey, civil aviation minister Ashok Gajapathi Raju and MoS (civil aviation) Jayant Sinha in New Delhi on Tuesday. Photo: PTI

New Delhi: More airlines may participate in the second round of the Udan regional connectivity scheme, civil aviation secretary R.N. Chaubey indicated on Tuesday, while announcing that the government has received 141 initial proposals for the aviation scheme.

At a press conference with civil aviation minister Ashok Gajapathi Raju in the capital, Chaubey said “participation by airlines has doubled” in the second round of the Udan scheme, routes for which will be given out next month after bidding. He declined to provide the names of the airlines as bids are yet to be opened but added that two-three major helicopter players have also shown interest in this round.

In the first round of Udan scheme, only Air India Ltd and SpiceJet Ltd had applied for the routes which were given out in March. IndiGo (InterGlobe Aviation Ltd) said in an analyst call on 19 May that it would bid for Udan routes while Jet Airways chief financial officer Amit Agarwal said on 13 September that the airline will look at second round of Udan.

To be sure, the Udan scheme has connected only a few airports so far. The government had given out about 128 routes in the first round in March but only about 18-26 routes have been started or are about to be started soon, said another aviation ministry official who did not wish to be named.

Airlines like Air Deccan and Air Odisha have sought more time and said they will start regional flights by 15 December and 15 January, Chaubey said, adding that some of the airports will also take about four more months to be able to handle flights.

IndiGo which is expected to get about seven of its 50 regional ATR planes from next month till March is also likely to expand regional connectivity. SpiceJet has also signed a contract to buy up to 50 Bombardier Q400 regional planes, adding to its existing set of 20 Q400 planes. Air India is already receiving new ATR planes to ply on new and exisiting routes.

Chaubey said regional operators like Air Deccan and Air Odisha who are yet to start flights they won in March will be “monitored” closely and if they do not start flights by January the government may penalise them by not awarding them routes under the ongoing Udan round.

To be sure, both Air Deccan and Air Odisha have had to go through the entire process of take a new license while Air India and SpiceJet were already airline operators.

The scheme, Ude Desh Ka Aam Nagrik (Udan), which loosely translates as “let the common man fly”, proposes that at least half the seats on every flight should have a fare cap of Rs2,500 per seat per hour of flying.

The ministry will require Rs300 crore this year to subsidise the scheme. It is also sorting out some goods and service tax related issues related to the Udan fund with the finance ministry, Chaubey said, without elaborating further.

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