UDAN has been supremely successful. First phase involved 128 routes and 70 airports, and most are operational. Second phase of 502 routes, 108 airports & 24 helipads, and earlier routes on full stream, is likely to push UDAN into a financial crunch. Aviation Ministry provides a 3 year viability gap funding to UDAN operators. VGF is decided by open bidding, and not every airline has asked for it.
Now Aviation Ministry is hinting at direct budgetary support. Alternative of not funding expansion, would to be disastrous. New infra will be in place, and higher traffic and expansion will bring scale and efficiency. Then procurement of small aircraft from India will surely cut costs and create viability. On the face of it Centre will be justified in seed funding indigenous aircraft industry and not mind a temporary financial burden of UDAN!!
Now Aviation Ministry is hinting at direct budgetary support. Alternative of not funding expansion, would to be disastrous. New infra will be in place, and higher traffic and expansion will bring scale and efficiency. Then procurement of small aircraft from India will surely cut costs and create viability. On the face of it Centre will be justified in seed funding indigenous aircraft industry and not mind a temporary financial burden of UDAN!!
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