By Ameya Joshi
Indian aviation in general and regional aviation in particular is looked at as a graveyard from a profit perspective. In a market where the likes of Kingfisher Airlines and Jet Airways have fallen, there is no dearth of examples of how many regional carriers have succumbed to the circumstances.
Amidst this with the advent of the Regional Connectivity Scheme – UDAN (Ude Desh ka Aam Nagrik) a new crop of airlines have started functioning in India, some flourishing or on the verge of it. While challenges remain, these airlines have ensured that connectivity reaches some of the remotest parts of the country and put new airports on the map of Indian aviation but also connects some new city pairs that remained hitherto unconnected. This includes city pairs like Goa – Lakshadweep, Jalgaon – Pune or Bengaluru – Shivamogga where flights have been a boon for tourism, trade and getting agri produce to market at a faster rate amongst other benefits.
The list of airlines which have closed down is long. Air Pegasus, Air Costa, Air Carnival, Religare Aviation, Deccan Charters, Air Odisha and TruJet are some of the regional carriers which shut down in the 2014 to 2020 period.
RCS – UDAN
The game changer was the RCS-UDAN scheme, a flagship initiative by the Government of India launched in 2017. The primary objective of this scheme is to make air travel affordable and widespread, thereby improving regional air connectivity across the country. It focuses on connecting unserved and underserved airports in tier-2 and tier-3 cities with major cities, thus enhancing the air network and boosting economic growth.
Under RCS-UDAN, the government provides financial incentives, subsidies, and concessions to airlines to operate flights on regional routes. These incentives include Viability Gap Funding (VGF) to ensure operational sustainability, reduced airport charges, and exemptions from various taxes. The selection of routes is carried out through a transparent bidding process, encouraging airlines to service less profitable routes by making them financially viable. The scheme also emphasizes the development and upgrade of airport infrastructure to accommodate increased passenger traffic, ensuring safety and efficiency.
Airlines born for RCS
The government-owned Alliance Air was the only carrier that was present in the regional space for a long time. However, later Star Air, fly91, Indiaone and Flybig joined in and today there is a steady mix of experience, a variety of aircraft types and spread in networks with these carriers.
Over the years, SpiceJet and IndiGo joined in and now have an expansive regional network with their turboprop aircraft and in some cases narrowbody aircraft as well. Regional aviation is not restricted to the regional players. There are 1088 city pairs in the country that see active flight operations this July as per data shared by Cirium – an aviation analytics company. A staggering 68% of the routes are monopolies of 747 routes out of 1088 see only one operator.
The largest is operated by IndiGo with 521 sectors which are monopolies. This includes regional as well as some mainline routes, but the focus has largely been on regional.
State-owned Alliance Air operates 85 monopoly routes, Indiaone operates 14, fly91 operates six, Air India operates 19, Air India Express operates 17, Akasa Air operates 4, Star Air operates 52, SpiceJet 23 and Vistara operates two.
Airports like Deoghar, Hollangi, Rupasi and Bhatinda would not have been on the air map had it not been for regional aviation in India. The northeast has been a special beneficiary of the scheme with a record number of airports now being operationalised.
Challenges of Regional aviation
Despite the mixed success, challenges remain in the regional aviation segment which impedes its growth and sustainability. One of the primary issues is infrastructural limitations; many regional airports lack essential facilities such as adequate runways, terminals, and maintenance hangars, which directly impact operational efficiency and safety. Additionally, poor road and rail connectivity to these airports further diminishes their accessibility and attractiveness to potential passengers. Financial constraints also play a crucial role, with high operating costs posing a persistent challenge. Regional flights often struggle with lower passenger loads and higher per-seat operating costs, compounded by elevated fuel prices and airport charges. While the UDAN subsidy covers up for the operating costs, it cannot be sustained for a longer term.
Operational challenges are equally daunting, particularly in fleet management. Regional routes require smaller aircraft, which are expensive to acquire and maintain, and there is a notable shortage of skilled personnel, including pilots and engineers, which affects service quality and safety. The regulatory landscape adds another layer of complexity, as navigating the bureaucratic processes to comply with various aviation norms and obtain necessary clearances can be cumbersome and time-consuming. Environmental and weather conditions are other critical concerns; many regional airports lack advanced navigation and weather monitoring systems, making them susceptible to disruptions due to adverse weather.
Tail Note
Regional aviation in India is an idea whose time has come to expand. As questions were raised on the 100 aircraft order of IndiGo in 2005, questions are being raised now on the regional landscape. However, a professional environment and one good regional breakthrough will make everyone invest in the regional space with much vigour.
Ameya Joshi is an aviation analyst and columnist who runs the analysis website Network Thoughts.
