The government launched its flagship regional connectivity scheme (RCS)—Ude Desh Ka Aam Nagrik (UDAN)—in 2016. The ambition? What the name says. Making flights accessible and affordable for the common man.
The first phase of the scheme, ending this year, ensured regional connectivity to unserved destinations. In the last 10 years, 92 unserved and underserved airports were operationalised under the scheme, of which 14 are now non-operational, with the government footing the Rs 900 crore bill on their maintenance. Half the routes have been discontinued and only a quarter remain self-sustainable at the end of the three-year subsidy period.
UDAN airports now account for 58% share of airports in India. However, these typically have limited flight operations. Despite expansion, UDAN airports contributed a relatively small share to domestic passenger traffic in 2024-25—a mere 2-3%—according to Crisil Intelligence.
Taking into consideration the hurdles, and to address the route sustainability issues, the government announced a modified UDAN earlier this year. Among other measures, it has increased the viability gap funding (VGF) period from three years. Also, the government will support airport operation and maintenance costs for three years at some airports to aid early-stage traffic. It has allocated Rs 28,840 crore to connect 120 new destinations and cater to 40 million passengers over the next 10 years. The new scheme transitions from a connectivity-first model to an ecosystem-driven approach focusing on developing aviation infrastructure.
Captain Simran Singh Tiwana, CEO of regional air carrier Star Air, says the modified UDAN framework marks a shift from simply connecting cities to integrating India’s most remote geographies into the national aviation network.
Pushan Sharma, Director, Crisil Intelligence, says UDAN 2.0 marks a pivotal shift in India’s regional aviation strategy, moving beyond the initial goal of expanding connectivity to focus on the sector’s long-term sustainability.
Manoj Chacko, MD and CEO of another regional airline, FLY91, says the modified UDAN framework, with its more structured and sustained support mechanism, provides airlines greater stability to build regional connectivity.
30/04/2026 Richa Sharma/Business Today
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