UDAN Scheme Likely to Include International Flights | CORPORATE ETHOS

UDAN Scheme Likely to Include International Flights

By: | March 9, 2018

March 9: Taking into account the successful execution of the regional connectivity scheme or UDAN (Ude Desh ka Aam Naagrik), the Union Government has lined up plans to extend the scheme for international flights too.

Rajiv Nayan Choubey, Civil Aviation Secretary, speaking at the Wings India 2018 event, said that the Assam government has evinced keen interest in connecting Guwahati airport with various South East Asian destinations. Reports quoted him as saying that the Assam government is willing to invest around Rs 100 crore a year for three years which will sum up to Rs 300 crore.

The Assam government has to invest money for the involvement of Central government, which will make the bidding process for UDAN International easier. Apart from Assam no other states have shown interest in the extension of the scheme yet, he was quoted as saying.

The Airport Economic Regulatory Authority (AERA) Act has been amended by the Civil Aviation Ministry through which the role of airport regulator in fixing tariffs will be reduced while allowing private developers to monetize land. Adding the government is working on a concession model agreement which is a framework that defines the incentives private operators get in running an airport. The concession model is expected to be out in the upcoming months.

There are plans to amend the Airports Authority of India Act which will allow the developers of brown field airports to monetize city side land which is at present forbidden. This had resulted in the lack of private sector investment.

Stating that building hotels outside the airport only for passengers is not easy and the Airports Authority of India Act clearly restricts the land usage of the city side airport only for passengers he said that there is  need to relax certain norms. He further said that there are plans going on to amend Airports Authority of India Act.

Choubey said that the government is looking into a model to develop state airports through the establishments of joint ventures between state governments holding 49% and the Airports Authority of India 51%. Here the losses by such airports for first 10 years will be funded by the state government and the capital expenditure to develop such airports will be spent by Airports Authority of India. He also said that there are 116 airports which can be developed under this model.

The investments needed for airport expansion and construction by 2030 will be $45 billion as estimated by Aviation consultancy CAPA.  Pointing out that the current functional airports under AAI are 80 out of 120 he said that the capital expenditure of AAI is expected to go up five times to Rs 15,000 crore a year. He also added that in 3-4 years, the country has witnessed the highest growth in the domestic passengers globally and the nearest competitor is staying aloof by 30- 40 per cent.