The Ministry of Civil Aviation (MoCA) has launched the 5th round of the Regional Connectivity Scheme (RCS) – Ude Desh Ka Aam Nagrik (UDAN).
The Ministry has concluded four successful bidding rounds and stated that UDAN5.0 would further enhance connectivity to the country's remote and regional areas and achieve last-mile connectivity.
Jyotiraditya Scindia, Minister of Civil Aviation & Steel, said, “UDAN has proved to be a lifeblood of many regions which are now well connected with places across the country. This new & stronger version of the scheme will raise the momentum, connecting new routes, and bring us closer to the target of operationalising 1,000 routes and 50 additional airports, heliports, and water aerodromes in the near future.'
The scheme will focus on Category-2 aircraft (20-80 seats) and Category-3 aircraft (>80 seats), and the earlier stage length cap of 600 km has been waived off.
There will also be no restriction on the distance between the origin and destination of the flight, but the same route will not be awarded to a single airline more than once, whether in different networks or the same network. However, route exclusivity will be withdrawn if the average quarterly Passenger Load Factor (PLF) is higher than 75% for four continuous quarters. This is being done to prevent the exploitation of a monopoly on a route.
Another change is that Viability Gap Funding (VGF) which was earlier capped at 500 km, will now be capped at 600 km stage length for both priority and non-priority areas. No predetermined routes will be offered, and only network and individual route proposals proposed by airlines will be considered for VGF.
MoCA has stated that airlines would be required to submit an action/business plan after two months from the issuance of LoA wherein they submit their aircraft acquisition plan/availability of aircraft, crew, slots, etc., at the time of the Technical Proposal.
To further incentivise quick operationalisation, the MoCA has stated that 25% of the Performance Guarantee will be encashed for each month of delay up to four months. As a result, airlines are now required to commence operations within four months of the RCS UDAN award of the route; earlier, this deadline was six months.
A list of airports that are ready for operation or would soon be ready for operations has been included in the scheme to facilitate quicker operationalisation of routes under the Scheme.
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