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UDAN and Modified UDAN: the Regional Connectivity Scheme

By CAShorts DeskPublished Sources: PIB backgrounder; Union Cabinet release (pmindia.gov.in); Airports Authority of India (RCS-UDAN Manual 2021, concessions note, RCS brief)

Why in news: A PIB backgrounder of 20 October 2026 marked UDAN's ten years and set out the Modified UDAN Scheme, formally launched on 4 July 2026.

UDAN and Modified UDAN: the Regional Connectivity Scheme
Illustration (AI-generated)

UDAN (Ude Desh ka Aam Nagrik), the Ministry of Civil Aviation's Regional Connectivity Scheme, pays airlines Viability Gap Funding and caps fares so they fly unserved and underserved routes. Launched on 21 October 2016 under the National Civil Aviation Policy 2016, it turns ten this month; its next phase, Modified UDAN, carries Rs 28,840 crore for 2026-27 to 2035-36.

Syllabus: Prelims · Economy & Social Development; GS3 · Infrastructure; GS2 · Government Policies

Why this matters for UPSC

GS3 infrastructure (airports) and GS2 government schemes: Prelims can ask UDAN's ministry, the Airports Authority of India's role, Viability Gap Funding and the Regional Connectivity Fund; Mains, how far UDAN has made regional flying viable.

In short

UDAN (Ude Desh ka Aam Nagrik) is the Ministry of Civil Aviation's Regional Connectivity Scheme, launched in 2016, that uses market bidding and time-bound subsidy to make regional flying affordable.

How an UDAN route takesoffAirlineproposesregional routeLowest VGFbid winsThree years'exclusivityCapped fareson RCS seatsRoute turnscommercial

UDAN has shown that small towns will fly; Modified UDAN must now make routes outlast their subsidy, or the network shrinks when support ends.

Why it matters

A resident of Lohit district in Arunachal Pradesh once spent over ten hours on the road to Dibrugarh or Guwahati to catch a flight or reach a hospital. Since Tezu Airport opened in 2021, Guwahati is an hour away, and ginger and cardamom leave as air cargo. That is what UDAN buys with public money: flights to places airlines would not serve on their own, at a fare a small-town family can pay. Its support is meant to last only a few years, so the real test is whether each route keeps flying once the subsidy stops. Modified UDAN tries to tip that balance with more airports, helipads and longer, tapering support.

Prelims pointers

  • National Civil Aviation Policy 2016: released by the Ministry of Civil Aviation; it provided for the Regional Connectivity Scheme and a levy on flights to fund it.
  • Fare cap (2021 manual): Rs 2,500, indexed to inflation, for a fixed-wing flight of about 500 km (one hour) or a 30-minute helicopter ride, on RCS seats only.
  • RCS seats (2021 manual): half of a fixed-wing flight's capacity, at least 9 and at most 40; on helicopters, all passenger seats up to 13.
  • Under the 2021 manual, non-RCS seats on an UDAN flight are sold at market-determined fares, so airlines can test prices and build demand.
  • Lifeline UDAN (March 2020): a hub-and-spoke air network that kept essential medical cargo moving during the COVID-19 lockdown, especially to the North-East, remote and hilly regions.
  • UDAN rounds: UDAN 2 focused on hilly, North-Eastern and island areas and helicopters; UDAN 3 added seaplanes and Tourism RCS routes with the Ministry of Tourism.

Practise a UPSC-style question

With reference to the Regional Connectivity Scheme UDAN, consider the following statements:

1. It is implemented by the Airports Authority of India for the Ministry of Civil Aviation.

2. A route is awarded to the airline that quotes the lowest Viability Gap Funding requirement.

3. It was conceived by the Ministry of Tourism to connect tourist circuits.

Which of the statements given above is/are correct?

  1. (a) 1 and 2 only
  2. (b) 2 and 3 only
  3. (c) 1 and 3 only
  4. (d) 1, 2 and 3
Show the answer

Answer: (a) 1 and 2 only

Answer: (a) 1 and 2 only. UDAN is a Ministry of Civil Aviation scheme run by AAI through VGF bidding.

Statement 1: correct. The UDAN Manual names the Airports Authority of India as the implementing agency of the Ministry of Civil Aviation's scheme.

Statement 2: correct. In the two-stage e-bidding, the route goes to the operator quoting the lowest Viability Gap Funding.

Statement 3: incorrect. The Ministry of Civil Aviation conceived UDAN under NCAP 2016; the Ministry of Tourism only later suggested Tourism RCS routes under UDAN 3.

Eliminate: Statement 3 is surest wrong, since UDAN is a Ministry of Civil Aviation scheme. Out: (b), (c), (d).

Trap: Swapped attribution. The Ministry of Tourism did take part in UDAN 3, so pinning the whole scheme on it sounds plausible.

Remember: UDAN = Ministry of Civil Aviation scheme, AAI implements, lowest VGF bid wins.

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