The Union Cabinet, chaired by PM Shri Narendra Modi, has approved the "Modified UDAN" (Ude Desh ka Aam Nagrik) scheme for a ten-year implementation period from FY 2026-27 to FY 2035-36.
With a total budgetary outlay of ₹28,840 crore, the initiative marks a transition from basic route operationalisation to a comprehensive, sustainable regional aviation ecosystem.
The scheme targets the expansion of air connectivity to underserved and unserved areas, specifically focusing on Tier-2 and Tier-3 cities. By fostering affordable air travel, the policy aims to boost economic growth, trade, and tourism while improving emergency response and healthcare access in remote and hilly regions. This phase is designed to support the Atmanirbhar Bharat vision and progress toward the Viksit Bharat 2047 goal of a globally competitive aviation ecosystem.
Key Pillars and Fiscal Allocation
Aerodrome Infrastructure (CAPEX): A dedicated outlay of ₹12,159 crore over the next eight years to develop 100 airports from existing unserved airstrips.
Viability Gap Funding (VGF): Allocation of ₹10,043 crore over 10 years to provide financial support to airline operators, ensuring longer-term market development for awarded routes.
Modern Helipad Development: Deployment of ₹3,661 crore to construct 200 modern helipads at an estimated ₹15 crore each, prioritized in aspirational districts for last-mile connectivity.
Operation & Maintenance (O&M) Support: Provision of ₹2,577 crore for 441 aerodromes. Support is capped at ₹3.06 crore per annum for airports and ₹0.90 crore per annum for heliports and water aerodromes for a three-year period.
Atmanirbhar Aircraft Acquisition: Direct procurement of indigenous assets including two HAL Dhruv helicopters for Pawan Hans and two HAL Dornier aircraft for Alliance Air to mitigate fleet shortages in difficult terrains.
What is "Viability Gap Funding" (VGF)? VGF is a fiscal mechanism providing financial grants to infrastructure projects that are economically essential but lack immediate commercial profitability. In the regional aviation context, it acts as a primary lever to bridge the gap between operational costs and revenue generated from capped, affordable fares. This mechanism mechanically incentivises private airline operators to service remote regions, benchmarking a trajectory where air connectivity transitions from a luxury service to a standardised public utility for the common citizen.
Policy Relevance: Benchmarking the 2047 Aviation Trajectory
Institutionalises a Framework for Inclusive Infrastructure: By targeting 100 new airports and 200 helipads, the scheme benchmarks a trajectory where geographical isolation is mechanically eliminated through a standardized national flight grid.
De-risks the Environment for Regional Operators: The introduction of structured O&M support for 441 aerodromes addresses the recurring cost bottleneck, ensuring that regional ground assets remain functional despite low initial traffic volumes.
Signals a Paradigm Shift in Aerospace Indigenization: The mandate to procure HAL-manufactured platforms for state carriers acts as a primary lever for the domestic aerospace sector, reducing the strategic reliance on foreign-made small aircraft.
Mechanically Bridges the Healthcare and Logistics Gap: The focus on modern helipads in hilly and island regions solidifies India’s standing in emergency response, allowing for rapid medical evacuation and last-mile supply chain integration.
Relevant Question for Policy Stakeholders: Will the selection process for the 200 modern helipads be weighted to prioritise districts with the highest "Emergency Response" and "Healthcare Access" deficits?
Follow the Full News here: Cabinet approves Regional Connectivity Scheme
