Udan's next phase gives states role in picking airports
Civil Aviation Minister Ram Mohan Naidu said on Tuesday that the next phase of the regional air connectivity scheme Udan will let state governments identify high-potential airstrips and aerodromes, as 21 states signed MoUs with the Centre. The scheme has been extended for another 10 years. Naidu said 90 airports were built in the last 10 years and new projects will be completed within 18 months. Viability gap funding support rises from three years to five.
Source
Civil Aviation — Ram Mohan Naidu · read the original report ↗
Desk check · compared with the source
What the desk checked (5)
- 21 states signed MoUs with the Centre for the next phase of Udan. — Stated in the source in connection with Minister Ram Mohan Naidu's remarks on Tuesday; figure appears in source.
- The scheme is being extended for another 10 years and 90 airports were built in the last 10 years. — Attributed directly to Civil Aviation Minister Ram Mohan Naidu.
- Next-phase projects will be completed within 18 months. — Attributed to the minister; presented as a target, not a verified outcome.
- Viability gap funding support extended from three years to five years. — Described in the source as a key change under modified Udan; attributed to officials, no document cited.
- More than 687 air routes and 97 airports were connected under Udan, launched in 2016. — Figures appear in the source, attributed to officials; source also notes 90 airports built, a figure an editor may wish to reconcile.
Analysts’ view opinion
Handing states the power to identify airstrips and aerodromes under the modified Udan scheme is not merely a technical redesign — it is a sharing of political ownership. By getting 21 states to sign MoUs, the Centre can point to broad buy-in, while the hardest parts — land acquisition, clearances, last-mile roads — now sit visibly with state governments. The 10-year extension and the stretching of viability gap funding to five years suggest a deliberate attempt to avoid repeating the political embarrassment of shuttered airports and discontinued routes.
- Letting states nominate sites turns airport siting into a live arena of Centre-state bargaining and intra-state constituency politics.
- The "Challenge Mode" framing rewards states that move fast, and also makes it easier for the Centre to attribute delays to state-level bottlenecks.
- Officials themselves citing Kushinagar and Moradabad as closed airports is an implicit acknowledgement that past implementation gaps are ready-made ammunition for critics.
- Extending VGF from three to five years with staggered fare increases is as much political insurance as economics — it guards against the awkward cycle of routes launched and then quietly dropped.
- Heliports for the Northeast and hill states, plus talk of domestic aircraft building and MRO growth, frame connectivity within a larger national-capability narrative.
What to watch — Watch which states move first on site selection, land and clearances — and whether opposition-ruled states allege bias in how projects are prioritised.
The story does not establish which 21 states signed, what funds are committed, which specific sites will be chosen, or how much cost states must bear; Purnea is mentioned only as an illustrative example.
Deep dive
Research brief · 8 facts · 4 dates · exam-readyThe brief
Context
Udan (Ude Desh ka Aam Nagrik), launched in 2016, is the Centre's regional air connectivity scheme that subsidises airlines through viability gap funding to fly to smaller towns, remote districts and tourist destinations. A decade on, the government has announced a "modified Udan" extended for another 10 years, with 21 states signing MoUs with the Ministry of Civil Aviation. The redesign responds to a key weakness of the original scheme: several routes and airports, such as Kushinagar and Moradabad in Uttar Pradesh, stopped operating once subsidy support ended. Civil Aviation Minister Ram Mohan Naidu announced the changes on Tuesday.
Key facts
- 21 states have signed MoUs with the Centre for implementing the next phase of Udan.
- The scheme has been extended for another 10 years, drawing on learnings from the previous phase.
- Naidu said 90 airports were built under Udan in the last 10 years; projects in the next phase are to be completed within 18 months.
- Udan, launched in 2016, connected more than 687 air routes and 97 airports.
- Viability gap funding (VGF) support for airlines has been extended from three years to five years.
- Airports such as Kushinagar and Moradabad in Uttar Pradesh shut down and no longer have airline operations, prompting a "reboot" for underserved airports.
- Officials call the new approach a "Challenge Mode", with states identifying locations where airports are needed; Bihar's Purnea was cited as an example of high passenger demand.
- Heliports will be constructed under the scheme, particularly in the Northeast and hill states.
Timeline
- 2016Udan launched to provide air connectivity to districts and remote locations, link tourist destinations and improve access to healthcare and business.
- Last 10 years90 airports built under Udan; more than 687 routes and 97 airports connected.
- Tuesday (story published Sep 23, 2026)Civil Aviation Minister Ram Mohan Naidu announces next phase of Udan with greater state role; 21 states sign MoUs with the Centre.
- Next phase (going forward)Scheme extended for 10 more years; projects to be completed within 18 months; VGF extended to five years.
Who has a stake
- Ministry of Civil Aviation (MoCA) — Will execute projects and provide funding, institutional support and the policy framework; signs MoUs with states.
- State governments (21 signatories) — Will identify high-potential airstrips and aerodromes and facilitate land, road and last-mile connectivity, security and fire/local clearances.
- Airlines / route operators — Depend on VGF for viability; being consulted on route identification as their investments and assets are involved.
- Passengers in smaller towns and remote districts — Access to air connectivity, healthcare, business and tourism; risk of fare shock when subsidy support ends.
- Northeast and hill states — Targeted for heliport construction under the scheme.
- Civil Aviation Minister Ram Mohan Naidu — Announced the extension, timelines and the shift to state-led site identification.
Why it matters
Regional air connectivity determines whether small towns get reliable links to markets, hospitals and tourism circuits, but the first decade of Udan showed that subsidised routes often collapse once support ends. By letting states pick sites and extending viability gap funding from three to five years with a staggered fare increase, the Centre is trying to make new airports both demand-driven and financially durable. It also marks a shift in Centre-state division of labour in infrastructure delivery, with states handling land and clearances and MoCA handling execution and funding.
UPSC angle
Prelims pointers
- Udan = Ude Desh ka Aam Nagrik, the regional connectivity scheme launched in 2016 under the Ministry of Civil Aviation.
- Udan so far: more than 687 routes and 97 airports connected; 90 airports built in 10 years (per the minister).
- Modified Udan: VGF support period raised from 3 years to 5 years; projects to be completed in 18 months.
- 21 states signed MoUs with the Centre for the next phase; scheme extended by 10 years.
- "Challenge Mode": state governments identify locations where airports should come up; Bihar's Purnea cited as an example.
- Heliports planned especially in the Northeast and hill states; MRO (maintenance, repair and overhaul) sector said to be developing.
Mains framing
The modified Udan scheme addresses a structural flaw exposed by the first decade of regional connectivity policy: subsidy-driven route creation without assured demand. Airports such as Kushinagar and Moradabad ceased airline operations, and officials concede several routes shut down once viability gap funding lapsed because passengers would not absorb higher fares. The redesign attacks this on three fronts — demand-led site selection, by asking states to nominate high-potential airstrips and aerodromes in a "Challenge Mode" with Purnea in Bihar as the template; longer financial hand-holding, by extending VGF from three to five years with a staggered fare increase over the additional two years to avoid a cost shock; and delivery discipline, with an 18-month completion timeline and a clear split of responsibilities where states handle land acquisition, road and last-mile links, security and fire and local clearances while MoCA funds, frames policy and executes. Consultations with airlines on route identification bring operator economics into the planning stage, and a "reboot" mechanism allows routes at defunct airports to be reallocated. The way forward rests on whether states nominate genuinely viable sites rather than politically attractive ones, whether the five-year window is enough to build habitual demand, and whether complementary capacity — heliports in the Northeast and hill states, domestic aircraft manufacturing and a maturing MRO ecosystem — keeps operating costs sustainable.
Key terms
- Udan (Ude Desh ka Aam Nagrik)
- Regional air connectivity scheme launched in 2016 to link districts, remote areas and tourist destinations by air.
- Viability Gap Funding (VGF)
- Financial support given by the Centre to airlines operating on Udan routes; now extended from three to five years.
- Challenge Mode
- Officials' term for the new approach where state governments themselves identify locations needing airports.
- Modified Udan
- The next, redesigned phase of Udan with greater state participation, longer VGF and revival of underserved airports.
- MRO
- Maintenance, repair and overhaul segment of aviation, which the minister said is developing in India.
- MoU with states
- Agreement between the Ministry of Civil Aviation and state governments for implementing the next Udan phase; signed by 21 states.
Practice questions
- Critically examine how the modified Udan scheme seeks to correct the shortcomings of the original regional connectivity scheme launched in 2016.
- "Viability gap funding can create connectivity but not demand." Discuss with reference to the closure of Udan routes and airports such as Kushinagar and Moradabad.
- Assess the implications of giving state governments the role of identifying airport sites for Centre-state cooperation in infrastructure delivery.
Grounded only in the source report — figures and dates are the source's, not inferred.