New Delhi, March 25 Revamping the regional air connectivity initiative, the Union Cabinet on Wednesday approved a modified UDAN scheme with an outlay of ₹28,840 crore for ten years, which will provide funding for developing airports, related operations and maintenance activities, helipads, and support for the acquisition of India-made aircraft.
Airlines will be provided Viability Gap Funding (VGF) for operating UDAN routes, and the estimated amount over the ten-year period starting from FY 2026-27 is ₹10,043 crore.
Briefing media persons after the Cabinet meeting, Information and Broadcasting Minister Ashwini Vaishnaw said that under the modified scheme, 100 airports would be developed from existing unserved airstrips with the help of state governments, and the outlay for this purpose would be ₹12,159 crore over the next eight years.
The scheme aims to develop 200 modern helipads at a cost of ₹15 crore each, amounting to a total requirement of ₹3,661 crore over the next eight years (adjusted for inflation), an official release said.
The focus will be on developing helipads in priority and aspirational districts to improve last-mile connectivity and emergency response.
Towards Operation & Maintenance (O&M) works, the scheme will provide support for three years, capped at ₹3.06 crore per annum per airport and ₹0.90 crore per annum per heliport/water aerodrome. The total estimated amount is ₹2,577 crore for around 441 aerodromes, the release said.
According to the government, the funding is being proposed, given the high recurring O&M costs and limited revenue streams for Regional Connectivity Scheme (RCS)-only aerodromes.
"To address the shortage of small fixed-wing aircraft and helicopters required for operations in remote and difficult terrains and to advance the Atmanirbhar Bharat vision, the scheme also proposes to procure two HAL Dhruv helicopters for Pawan Hans and two HAL Dornier aircraft for Alliance Air," the release said.
The modified UDAN (Ude Desh ka Aam Nagrik) scheme has been approved for the period from FY2026-27 to FY 2035-36 with a total outlay of ₹28,840 crore, and there will be budgetary support from the central government.
The existing UDAN scheme ends later this year.
Since the launch of UDAN in October 2016, the government said that 663 routes have been operationalized across 95 airports, heliports, and water aerodromes. These figures are as of February 28.
More than 3.41 lakh flights have been operated, carrying 162.47 lakh passengers under the scheme, which has fostered growth in regional airlines and diverse fleet operations, it added.
Civil Aviation Minister K Rammohan Naidu said that airports are not merely transit hubs but also the economic engines for the region, with a multiplier effect on employment and GDP across all connected sectors.
"With Modified UDAN, the path is laid for Viksit Bharat 2047 and Viksit Aviation 2047 undoubtedly. Promoting Atma-Nirbhar Bharat, budgetary allocations have also been made for state-owned Pawan Hans Limited to procure 2 Made in India Dhruv helicopters and Alliance Air to procure 2 Made in India Hindustan 228 Aircraft," he said in a post on X.
India is one of the world's fastest-growing domestic civil aviation markets.
Disclaimer: Due care and diligence have been taken in compiling and presenting news and market-related content. However, errors or omissions may arise despite such efforts.
The information provided is for general informational purposes only and does not constitute investment advice, a recommendation, or an offer to buy or sell any securities. Readers are advised to rely on their own assessment and judgment and consult appropriate financial advisers, if required, before taking any investment-related decisions.
Last edited by a moderator: