UDAN Scheme to Add 100 Airports to Boost Regional Connectivity

Industry Outlook Team | Thursday, 26 March 2026

Text Size:

UDAN scheme expansion is now official. The Government of India has approved a revamped regional connectivity plan with a Rs 28,840 crore outlay for the next 10 years, aiming to bring underserved regions onto the aviation map while fixing long-standing issues around route reliability and airport viability.

Under the upgraded UDAN scheme, 100 new airports will be developed using existing unserved airstrips, backed by Rs 12,159 crore. The plan also focuses heavily on remote access, with 200 helipads to be built across hilly, island, and aspirational regions, each receiving Rs 15 crore in funding. The move is designed to improve last-mile air connectivity where traditional infrastructure remains limited.

A major highlight is the allocation of Rs 10,043 crore as viability gap funding (VGF) for airlines operating regional routes. This support, spread over a decade, aims to make low-demand routes financially sustainable and prevent frequent service disruptions that have affected the scheme since its launch.

Also Read: Smart Manufacturing: From Connected Units to Cognitive Businesses

The decision was cleared during a Union Cabinet meeting chaired by Prime Minister Narendra Modi, with a clear focus on improving operational stability. The government acknowledged that high operating costs and low passenger volumes have made many regional routes difficult to sustain. To address this, the scheme includes operational and maintenance (O&M) support for three years. Airports will receive up to Rs 3 crore annually, while heliports and water aerodromes will get up to Rs 90 lakh per year. This support is expected to cover around 441 aerodromes at a cost of Rs 2,577 crore.

“Given the high recurring operation and management costs and limited revenue streams for RCS-only aerodromes, the scheme proposes to provide O and M support for three years capped at Rs 3 crore per annum per airport and Rs 90 lakh per annum per heliport/water aerodrome, estimated at Rs 2,577 crore for around 441 aerodromes,” a Govt statement said.

The scheme also includes fleet expansion using indigenous aircraft. “The scheme also proposes to procure two HAL Dhruv helicopters for Pawan Hans and two HAL Dornier aircraft for Alliance Air.”

Union aviation minister Ram Mohan Naidu said: “Over the last 10 years, UDAN has been able to add 663 new routes, 95 new airports (including heliports and water aerodromes). Around 1.6 crore passengers have travelled, making the dream of Inclusive and democratized air travel a reality. With today’s cabinet approval, another 100 airports, 200 heliports will be added to India’s Aviation growth story with an estimated 4 crore passengers to be benefited.”

“Along with infrastructure support, Rs 10,043 crore is also envisaged as VGF support for the airlines. Airports are not merely the transit hubs but also the economic engines for the region with multiplier effect on employment and GDP across all connected sectors…. budgetary allocations have also been made for state-owned Pawan Hans to procure two made in India Dhruv helicopters and Alliance Air to procure two made in India Hindustan 228 Aircraft,” Naidu added.

Key Data and Statistics