Administrative Innovations- UDAN (Ude Desh ka Aam Nagrik) - affordable air connectivity for all. 3rd September, 2021 1 Hon’ble Prime Minister’s vision to fulfill the common man’s aspirations of flying

Aviation was once considered the domain of a select few, but “ that has changed now with the advent of UDAN. My dream is to see a person who wears a 'hawai chappal' to fly on the 'hawai jahaz’. ” Genesis of UDAN to achieve affordable regional connectivity Sab Uden Sab Juden 2 Realization of the vision faced numerous challenges

 Skewed development of the Indian Aviation Sector with concentrated connectivity on select routes. Top 6 & 18 airports: ~65% & ~86% of traffic.

 Inadequate availability of aviation infrastructure in regional and remote areas.

 Making air travel affordable.

 Non-viable commercial operations on regional routes.

Metro Hub Airports

Minor Hub Airports  Policy, regulatory and resource constraints, Gaps especially for smaller aircrafts.

3 UDAN - Guiding principles with innovation at their core 1. Connectivity with Affordability 5. Monetary and non-monetary incentives

• Nominal airfare cap of INR 2500 for an hour flight, as per National • Stakeholders provide monetary and non-monetary Civil Aviation Policy 2016. incentives to reduce cost of operations. • UDAN airfare caps comparable to second AC railway fares. • An exclusivity period is provided to selected airlines for • The airfare cap of INR 2500/hour (regressed, calibrated, adjusted). certainty of continuous operations - leads to 0 VGF routes. 2. Differential Fares 6. Infrastructure Development for Accessibility

• Airfares capped on some seats (UDAN seats); Fares on • Number of idle airstrips identified for revival for expanding the remaining seats left to market forces. power of aviation network (new nodes are added). • Complementary development & up-gradation of unserved / • Fares of non-UDAN seats enhance market linkages for underserved airports connecting routes awarded under the sustainability and reduce financial burden. Scheme. 3. Resource optimization and cross subsidy • Budgetary allocation of INR 4500 Crore. 7. Mainstreaming Regional Development • Self Financing with No Budgetary Support - “By the Sector, For the Sector”. • Special incentives for airlines to create networks to connect • Airlines voluntarily contribute nominal levy on profit-making routes identified priority areas (unserved & remote regions like to subsidize regional routes. INR 5000/ departure. NE [North East], Hilly Areas).

• RACFT for management of funds. • Encouraging international connectivity. 4. Market Determined Routes

• Routes determined through competitive and transparent 2 stage bidding process. • Market determined Viability Gap Funding (VGF). • Subsidy for a 3 year period after which commercial operations begin. 4 UDAN - Institutional mechanisms with transparent and dynamic processes

Robust Internal Continuous Improvement Institutional Arrangement Technology Driven Governance Processes and Evolution of Scheme

Detailed Standard Operating Evolving priorities and Committees at different levels Integration with electronic Procedures to drive all objectives of the Government. with stakeholder representation platforms of airlines and UDAN processes. and well-defined roles. airports to transfer funds from airlines to the Trust automatically. Market response and participation patterns of Automatic transfer of VGF airlines. Forming a Trust to receive from RACFT to airlines after funds from airlines, States, etc. due assessments.

Transparency through an Continuous consultations / electronic platform ( MSTC e- inputs from institutionalized commerce portal) for two Simplified the licensing and stakeholders. Structured monitoring through stage bidding - one stop security procedures. UDAN Cell - collects daily flight solution for bidding, information data, collates it monthly and dissemination and monitoring. calculates VGF requirements. Improvising based on Periodic review and course implementation issues and correction. limitations.

5 UDAN - Driving the growth of the aviation sector 60 7.2mn UDAN Airports (incl. 5 heliports & 2 Passengers already benefitted WA) developed & operationalized in 4 from the Scheme. years as against 76 airports pre-UDAN. ~30 5% States / UTs have signed MoUs as Incremental growth in domestic partners in the Scheme and offered passenger share of non-metro concessions. airports. 369 11 Routes operationalized connecting Airlines have started operations 100+ airports. under UDAN including 3 start-ups. 10 780 Routes proposed under International- Routes awarded after 4 rounds of UDAN with focus on Northeast. bidding under UDAN.

100+ 70% Regional aircrafts ordered for regional average load factor on the regional connectivity. routes.

6 UDAN – Fulfilling the dreams of the Common Man to Fly

Future Impact

100 40+ ~10mn 1000 35 Additional unserved Heliports and water- annual seats will Awarded routes to States and UTs UDAN airports to be aerodromes to be open up due to be operationalized. will be connected connected. connected. UDAN every year. under UDAN.

7 UDAN - Highlights of the changing aviation landscape

 An example of airline industry farsightedness - Voluntary  UDAN leads to a virtuous cycle with growth of profitable contribution (Rs. 5000. Per departure) is indeed an investment. routes leading to more UDAN flights, in-turn facilitating increased demand and growth for profitable routes.

 Laid the foundation for Air- Krishi UDAN to provide an impetus  Boost to Business – connectivity to industrial hubs to movement of air cargo. {Jharsuguda, Kishangarh (Ajmer), Bhavnagar}.

 Newer modes of air transport - seaplanes, helicopters, smaller  Promoting Incredible by connecting iconic tourism aircraft. hotspots (Buddhist Circuit, Rajamundry).

 New types of aerodromes – heliports (Gaucher, Tezu) and  Start-up and scale-up opportunities for small regional and water aerodromes (Statue of Unity, Umrangso Reservoir). MSME airlines (Trujet, ).

 First Aircraft (Dornier) to be used under UDAN.  Increasing number of 0 VGF routes - -, - and Adampur-Delhi etc.

 A healthy competition among States to get UDAN flights.  Regional to Remote - North East (ACT East with Pasighat, States are offering more incentives such as underwriting seats. Tezpur) and Islands (Port Blair, Agatti).

 Development of airports across the country including in States that had 0 operational airports (, ,  UDAN is a resilient and replicable Scheme which has been able ). to continuously adapt itself to achieve various goals.

8 New modes of travel - Helicopters and seaplanes

India’s first-ever heliports for commercial operations • No-frills infrastructure. • Heliports under progress: 31 • Heliports operationalized till FY 2020-21: 5

India’s first-ever water aerodromes for seaplane operations • Sites selected for water aerodromes: 14 • Bid floated on behalf of Sagarmala Projects (UDAN 4.1). • MoU with shipping ministry for waterside works. • Water aerodromes operationalised during FY 2020-21: 2

9 Resilience of UDAN put to test by COVID-19

 UDAN’s organizational structure, aircraft fleet and airports Network Planning by Creating a Hub and Spoke seamlessly transitioned to include Helicopter/Seaplane Model for LIFELINE UDAN operations, International UDAN and Krishi UDAN.

 Delivered testing kits and medical equipment to remote locations, when movement by all other modes of transport was restricted.

 Post lockdown, adapted and modified certain parameters of UDAN to undertake UDAN-4.0 award (92 routes awarded) in calibrated manner reducing the VGF requirements substantially.

 Implemented economizing measures within the Scheme framework to bring down VGF requirements by ~40% on select routes during COVID-19.

Chennai to Andaman  Even though normal flights have reached 50% by IAF operationalization rate, UDAN flights have performed much better with ~70% operationalization rate.

10 Lifeline UDAN - Adaptive to emergent situations, disasters and challenges

Continuous Engagement Specialized / Designated Integration of and Collaboration with Core Team – Technologically Adept In order to help transport of Stakeholders – Fast pace decision making Solutions - Establishment medical cargo to every Private airlines, IAF, AAI, and the implementation of of the Lifeline UDAN corner of the country, an State / UT Governments, Lifeline UDAN under a war Portal, WhatsApp groups “ important mission “Lifeline ICMR and HLL etc. room setup. and video conferencing. UDAN” has been launched. Our Airlines have flown 3,00,000 kilometers within the country in such a short 588 ~1000 NER Experts, period of time and have flights operated. tons of medical islands and hill states equipment carried (ICMR transported 1000 tons of cargo transported. connected. labs, PPE , essential cargo. ” Visakhapatnam Gas Leak)

11 UDAN doing its bit towards nation building - contributing towards Socio- Economic goals of the nation

Economic Aspirations Fulfilled Social Cohesion Other benefits Development

• Air travel in India - was still • Helped connect areas not • Provision of air transport • Quality of life: By a luxury and not accessible adequately connected services to under-served providing an avenue for to all. through surface and un-served cities / leisure, exploring different transportation - difficult towns gives impetus to cultures and traditions. • UDAN is drastically (hilly) terrain, island states regional economies. changing this narrative by and areas with security • Essential services: fulfilling the aspirations of concerns. • UDAN facilitates growth of Established aviation India’s common man. allied industries like tourism connectivity network - • In line with “Sabka Saath and hospitality; and also critical in times of • A large number of first time Sabka Vikaas”, UDAN has gives a boost to local emergency to transport flyers have been able to helped reduce the businesses. medical supplies, take to the skies due to inequality of access. personnel etc. - exhibited UDAN. • As per an ICAO study, the by Lifeline UDAN. output and employment multipliers of aviation are • Safe and efficient: 3.25 and 6.10, respectively. Aviation is the safest and most efficient mode of long- range mass transport.

12 UDAN - A development paradigm in news

“It is because of UDAN that any common man can now access flights at affordable rates which is contributing to the overall growth of the country.”

. “Schemes such as UDAN are bridging the rural and urban divide, improving our transport infrastructure. Krishi UDAN will also be launched by MoCA on international and national routes."

“Long known as the mode of transport of the affluent sections of the society, PM Modi’s visionary inclusive policies based on the principle of ‘Sarvodaya through Antyodaya’ is also visible on India’s aviation sector. "

13 14 Thank You! 14