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Govt plans to invite bids for Udan-III next month, routes up for auction includes Aurangabad, Bodhgaya and Hampi

The Ministry of Civil Aviation on Thursday said it is likely to announce the third phase of the regional air connectivity scheme, Udan, next month. The routes up for auction in this phase will include popular tourist destinations such as Mahabodhi temple in Bihar, Ajanta and Ellora in Aurangabad and Hampi in Karnataka, among others. “We are planning to invite bids for Udan-3 in September and announce successful bidders by October,” minister of state for civil aviation Jayant Sinha told reporters on Thursday.

The Ministry of Tourism had identified 12 tourist hotspots to connect under Udan.Under Udan, an airline can choose to serve the destinations on offer from anywhere depending on its traffic feasibility studies. In this scheme, fares are capped at Rs 2,500 for an hour-long flight for 50% of seats. The remaining seats can be sold at market rates.

The Ministry of Civil Aviation provides a viability gap funding (VGF) for the 50% seats where fares are capped. However, under the routes on the tourist network, the VGF will come from the tourism ministry. In the two rounds of Udan so far, the government has auctioned 630 routes for fixed wing and helicopters. Major domestic airlines like IndiGo, SpiceJet and Air India had won several routes on offer under the scheme. However, routes on major airports such as Delhi, Mumbai and Pune are unlikely to be available as they are facing capacity constraints.

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