Budget 2023: Centre to revive 50 airports to improve regional air connectivity

In Budget 2023-24, which was tabled in Parliament on Wednesday, the minister proposed to revive 50 additional airports, heliports, water aerodromes and advance landing groundings “for improving regional air connectivity”.

In recent years, the Centre has been improving regional air connectivity through its flagship scheme, UDAN, which focuses on connectivity between Tier-2 and Tier-3 cities.

Boost for the UDAN scheme

The Economic Survey – 2023, which was tabled in Parliament on Tuesday, had said the UDAN scheme has considerably enhanced regional connectivity through the opening of airports in India’s hinterland.

Under this scheme, the government has approved a budget of Rs 4,500 crore for the revival of existing unserved or underserved airports or airstrips of State governments, the Airports Authority of India (AAI), public sector undertakings and civil enclaves.

The government has also accorded ‘in-principle’ approval for the setting up of 21 greenfield airports across the country.

“More than one crore air passengers have availed themselves of the benefit of the UDAN scheme since its inception,” the survey had said. “The scheme focuses on the connectivity between the Tier-2 and 3 cities in the country and the number of beneficiaries will increase manifold as the connectivity improves between unserved and underserved airports.”

The 10-year-old scheme was launched in October 2016, as part of the National Civil Aviation Policy unveiled that year. Its first flight took place in April 2017, connecting Delhi with Shimla.

To enhance regional air connectivity, the scheme provides viability gap funding (VGF) to airlines that have been selected via a bidding process to operate flights on under-served or unserved routes.

Move part of increased capex in FY24

The proposal to enhance funding for regional air connectivity is part of the increased outlay for capital expenditure in budget FY24.

“Capital investment outlay is being increased steeply for the third year in a row by 33 per cent to Rs 10 lakh crore, which would be 3.3 percent of GDP,” Sitharaman said in her budget presentation.

“This will be almost three times the outlay in 2019-20.”