Monday, May 01, 2017

UDAN takes wing

Gone are the days when air travel was the exclusive domain of the high and mighty and a distant dream for the common man. The entry of private sector and the rising income levels of an aspirational middle class have spurred the growth in domestic aviation. According to International Air Transport Association (IATA), India witnessed highest growth of 23% in domestic air travel demand worldwide in 2016, flying nearly 100 million passengers on domestic routes. The country is now ideally placed to take the next logical step and make flying affordable to the common man and bring smaller cities and towns on the aviation map. The newly launched scheme “UDAN” (Ude Desh Ka Aam Naagrik) is a path-breaking move to spur regional air connectivity, make air travel more affordable and provide a major economic boost to hinterland areas. With fares being capped at Rs 2,500 for one-hour flights covering a maximum distance of 800 kms, it would be a boon for passengers. Under the scheme, the Government has awarded 128 routes to five airline operators who will get several incentives like Viability Gap funding of Rs 3,000 per seat, tax concessions, land and other essential services. The scheme also provides a three-year exclusivity period for the selected airlines on specific routes they have won. This means there will be no competitive pressures during the period. Airlines will reserve 50% of seats under the stipulated fare cap while the remaining will be demand-driven.
01/05/17 Telangana Today