Alliance Air Receives 28 Idle Routes Under UDAN Scheme

Alliance Air, the state-owned carrier has been allotted with 28 more UDAN routes. These routes were distributed to other carriers during the last round, but the airline operators are yet to start operations. Hence, the Ministry of Civil Aviation (MoCA) canceled those contracts, and through short bidding, Alliance Air has bagged the majority of them.

Alliance Air Gets More UDAN Routes

Under the short-bidding round of UDAN 5.3, the Ministry of Civil Aviation (MoCA) has awarded as many as 28 routes to Alliance Air. This allotment was concluded on May 28. Since the Model Code of Conduct was live at that time, the Ministry sought special authorization from the Election Commission of India (ECI).

A few routes allotted to Alliance Air include:

• Ahmedabad to Keshod
• Guwahati to Rupsi
• Guwahati to Tezu
• Imphal to Tezu
• Jaipur to Bikaner
• Jalgaon to Ahmedabad
• Jalgaon to Mumbai
• Jorhat to Pasighat
• Kolkata to Rupsi
• Kullu to Jaipur

The bidding round prioritized those routes, which were based on the promotion of tourism. Routes in Northeast India connecting Guwahati, Imphal, Tezu, and Rupsi were previously allotted to FlyBig Airlines, but the airline was forced to suspend these services when its lessor ceased the ATR-72 fleet.

This short bidding comes just a month after the government increased the UDAN charges for scheduled carriers. For every departure, large airlines have to pay a UDAN levy to fund the scheme. From early May, this levy has been increased. For every departure above 40 tonnes of weight, the airline needs to pay Rs 6,500. Earlier, it was Rs 6,000.

Launch Soon??

A source told Financial Express that the Ministry had asked airlines whether they could start flights on these routes as soon as possible. Alliance Air agreed to launch these flights on short notice. Officials from MoCA conducted special checks to assess whether the airline was prepared or not. On checking, it was found that the airline has the equipment and workforce to operate on these routes. It has already started the bookings on the Kolkata to Rupsi route.

Until last year, MoCA has awarded 1,300 routes under the UDAN scheme. Of these, it had to cancel the contracts of 500 routes, since the airlines were not willing to start operations. Instead of re-auctioning these routes, the ministry is short-bidding them to carriers. Re-auctioning is a time-consuming process. More such routes will be allotted to airlines in the coming time.

To make sure that the route is sustainable, the Ministry has established a standard passenger load factor threshold to determine the eligibility of a route for funding. If the PLF is below that threshold, it will not receive the funds. Earlier, the duration of payment of VGF used to be three years, which has been increased now.

The UDAN scheme has proved to be a boon for various airports like Darbhanga and Jharsuguda. Launched in 2016, the scheme has helped more than 3 crore passengers. Various airports are under development as part of this scheme.

Conclusion

Alliance Air has been allotted with 28 more UDAN routes by the Ministry of Civil Aviation (MoCA). Under the UDAN scheme, airlines offer subsidized airfares to passengers. Subsidies are funded by other scheduled major airlines. The government has canceled the awards of 500 routes, which will be reallotted.

What do you think about Alliance Air getting more routes under the UDAN scheme? Discuss in the comment section.