VGF under the UDAN scheme

Civil Aviation

GOVERNMENT OF INDIA MINISTRY OF CIVIL AVIATION RAJYA SABHA UNSTARRED QUESTION NO : 354 (TO BE ANSWERED ON THE 16th September 2020) VGF UNDER THE UDAN SCHEME Will the Minister of CIVIL AVIATION be pleased to state:- (a) whether Bhubaneshwar in the State of Odisha is being provided any Viability Gap Funding (VGF) under the UDAN scheme as promised by the Ministry? (b) if so, the quantum of funding offered under the same? (c) if so, the progress under the same in the Financial Year 2020-21? and (d) if not, the reasons therefor? ANSWER MINISTER OF STATE (IC) IN THE MINISTRY OF CIVIL AVIATION (Shri Hardeep Singh Puri) (a) to (d): The primary objective of Regional Connectivity Scheme (RCS)- Ude Desh ka Aam Nagrik (UDAN) is to facilitate / stimulate regional air connectivity by making it affordable. Promoting affordability of regional air connectivity is envisioned under RCS by supporting Selected Airline Operators (SAOs) through concession by Central Government, State Governments/UTs and airport operators to reduce the cost of airline operations on regional routes and financial (Viability Gap Funding or VGF) support to meet the gap, if any, between the cost of airline operations and expected revenues on such RCS routes. VGF is a financial support to be provided to the SAOs for operation of RCS flight from Regional Connectivity Fund as per their bid document submitted at the time of bidding. Thus, no city/airport is eligible for VGF as per the provisions of scheme document. Cabinet Committee on Economic Affairs has approved the proposal for revival of existing unserved / underserved airports / airstrips of the State Governments, Airports Authority of India, Public Sector Undertakings and Civil Enclaves at an estimated cost of Rs. 4500 Crore. An airport which is included in the awarded routes of RCS-UDAN and requires upgradation/development for commencement of RCS operations is developed under "Revival of unserved and underserved airports" scheme Routes connecting Jeypore, Utkela, Rourkela and Jharsuguda airports in Odisha 354. DR. AMAR PATNAIK have been awarded under RCS-UDAN. Development/upgradation of these airports have been undertaken under "Revival of unserved and underserved airports" scheme. Further, VGF disbursed to SAOs for operating RCS flights connecting Jharsuguda airport in Odisha is Rs. 49,53,89,202/- as on 31.07.2020. However, routes connecting Jeypore, Utkela and Jharsuguda airports were cancelled due to the non compliance of Selected Airline Operator (SAO) Agreement by the SAOs. These airports were offered under second and third rounds of bidding under RCS-UDAN. However, no valid bid was received for Jeypore and Utkela Airport. Under UDAN third round, RCS routes connecting Jharsuguda airport to Kolkata, Bhubaneswar, Hyderabad, Mumbai, Delhi and Raipur airport were awarded.