The government is preparing a significantly enhanced version of the UDAN (Ude Desh Ka Aam Nagrik) regional air connectivity scheme, with a proposed outlay of ₹30,000 crore, according to industry sources. The expanded framework is designed to extend UDAN beyond April 2027 and strengthen India’s regional aviation network.

The Expenditure Finance Committee (EFC) under the Ministry of Finance reviewed the proposal this week and is expected to make a decision soon. Once cleared, it will be sent to the Union Cabinet for final approval.

Funding Structure

Of the ₹30,000 crore proposed:

• ₹18,000 crore is earmarked for new airport development, and

• ₹12,000 crore allocated for viability gap funding (VGF) to support airlines operating on underserved routes.

The revised scheme will continue incentivising the construction of new airports and the expansion of existing ones, while offering airlines VGF support and concessions from airport operators and both central and state governments.

Expanded Framework

The new version aims to resolve earlier implementation challenges, draw more private-sector participation, and improve air accessibility in remote regions. UDAN was launched in October 2016 under the National Civil Aviation Policy to make air travel affordable and boost regional connectivity. The first UDAN flight took off in April 2017 between Shimla and Delhi.

The original scheme, backed by over ₹8,000 crore, helped operationalise 649 out of 915 sanctioned routes, connecting 92 underserved airports, 15 heliports, and two water aerodromes. However, several airports still remain unserved.

The expanded scheme aligns with the announcement made by Finance Minister Nirmala Sitharaman in the Union Budget 2025–26.