Ashwini Phadnis Carrying forward the government’s Regional Connectivity Scheme (RCS) or UDAN, Budget 2018-19 provides, ₹ 1,014.09 crore for operating flights to tier II and tier III cities within the country during 2018-19. This is a five-fold increase from the ₹200 crore made available in the previous year.

The over ₹1,000-crore corpus will be used to provide Viability Gap Funding (VGF) for flights being operated under RCS. The scheme hopes to get the common man fly by connecting tier II and tier III cities in the country.

The scheme seeks to incentivise airlines and operators with the government providing Viability Gap Funding to make operations to these cities profitable. Under the scheme, airlines are required to provide at least 50 per cent of the seats on every flight at ₹2,500 for one hour of flying. The ceiling of subsidised seats is 40, while the minimum number of seats on an aircraft which have to be offered to avail VGF is 9.

The ₹1,014.09-crore for VGF will come from the dividend that Airports Authority of India will be paying to the government in 2018-19. The Ministry of Civil Aviation had written to the Finance Ministry seeking that a portion of the dividend being paid by AAI be used to part fund the VGF requirements for UDAN.

The Budget also talks about NexGen Airports for National Accreditation Board for Hospitals & Healthcare Providers (NABH), but what these will look like was not immediately clear as officials declined to comment on the proposed structure of these airports.

Sea-plane investments

The Finance Minister also announced that for promoting tourism and emergency medical care, government will make necessary framework for encouraging investment in sea-plane activities. Welcoming the statement, Ajay Singh, Chairman and Managing Director, Spicejet said “This project has the potential to convert every river into a runway and every pond into an airport thus providing hundreds of thousands of airports to the country”. SpiceJet has indicated that it plans to acquire 100 sea-planes from Setouchi in Japan to start sea-plane services in the country.

VVIP aircrafts

The Budget makes provisions for the President, Vice-President and the Prime Minister travelling in greater comfort as it provides ₹ 4,469.50 crore for purchase of two new aircrafts for ‘Special Extra Section Flight Operations,’ an acronym for the flights taken by the VVIPs normally on their visits abroad.

The funds have been made available in the Notes on Demands for Grants, 2018-19 for the Ministry of Civil Aviation. Currently the dignitaries use a Boeing 747 aircraft for their foreign travel and the Boeing 777 is expected to replace this, which has been in use for several decades.

The two Boeing 777-300 Extended Rage aircraft arrived in India about a fortnight ago and it will be at least another 12 to 18 months before they are properly fitted from a security, safety and comfort point of view to carry the VVIPs.

Air India currently has 12 Boeing 777-300 ER, which seat 342 passengers including five in first class and 35 in business class. The aircraft is used to operate non-stop flights to and from the United States from India.

Normally the special flights operated for VVIPs carry fewer passengers and have a VVIP section, which is a specially-created cabin with a bed and other amenities.

In addition, the front section of the aircraft normally has a first class suit for Ministers and officials travelling with the VVIP. In the back of the aircraft is a specially created business class for media, support staff and security officials.

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