Saturday, October 22, 2016

Plan to get more flying takes wing

New Delhi: The civil aviation ministry on Friday unveiled the operational modalities of its regional connectivity scheme UDAN (Udey Desh ka Aam Nagrik) to connect the country’s 394 unserved and 16 under-served airports, capping airfare at R2,500 for half of the seats in one-hour flights. However, incumbent airlines were not enthused as they felt the move could push up the airfares for existing customers and suggested that the government should instead fund the scheme wholly through its budget.
Brushing aside such apprehension, civil aviation minister Ashok Gajapathi Raju said, “We are cautiously optimistic about it (UDAN),” adding that the first flight under the scheme is expected to take off in January 2017.
Though the government will be providing for viability gap funding to finance airlines plying on the RCS routes, what has irked the incumbent carriers is one component of it — levying a cess on tickets for the non-RCS routes. Though the aviation ministry did not disclose the cess amount on Friday stating that it will be announced by the month-end, it tried to assuage ruffled feathers by saying that the amount will be “very small”.
22/10/16 Financial Express