The Hype: UDAN is Failing Because Routes Are Closing
It’s an alarming statistic that grabs headlines: nearly half of the routes launched under the Ude Desh ka Aam Nagrik (UDAN) scheme are no longer operational. Reports from early July 2026 indicate that of the 669 routes made operational since 2017, only
336 remain active. This figure is often presented as definitive proof that the entire Regional Connectivity Scheme (RCS) is a failure, wasting thousands of crores in public funds on unviable projects. The narrative is simple and powerful: the government promised cheap flights for the common citizen, but airlines are abandoning routes, and airports are becoming ghost towns. This view is further bolstered by official reports, including a 2023 CAG audit, which noted that a high percentage of awarded routes never even commenced operations.
The Context: Why Routes Really Get Discontinued
The reality is far more nuanced. Route discontinuation is a built-in, and even expected, part of the UDAN model. The scheme provides subsidies, known as Viability Gap Funding (VGF), for a limited period, typically three years. The goal is to give airlines a runway to build demand on routes that are not initially profitable. When this period ends, some routes naturally fall off the network if they haven't become commercially self-sustaining. As seen at airports like Bidar and Kalaburagi in Karnataka, services were discontinued by the airline once the subsidy period expired. Other major reasons cited by the Ministry of Civil Aviation include low passenger demand on specific routes, the financial collapse of regional airlines, global supply chain issues grounding aircraft, and delays in making airports fully operational. Discontinuation is not always a sign of failure, but often a market correction.
The Hype: Airlines Are Just Taking Subsidies and Leaving
A common cynical take is that airlines are simply 'gaming the system' by collecting VGF for three years and then immediately abandoning the route once the financial support dries up. This perspective suggests a lack of genuine commitment to regional connectivity from the private sector. The argument is that these routes were never meant to be viable and are just a way for carriers to get a government handout. While opportunistic behaviour can't be entirely ruled out, this view overlooks the immense financial risks and operational challenges airlines face.
The Context: The Brutal Economics of Thin Routes
Operating on thin regional routes is incredibly challenging. Airlines operate on razor-thin margins, and the fare caps imposed by UDAN, while good for passengers, add to the financial pressure. Many smaller carriers that entered the market specifically for UDAN have struggled with the high costs of maintenance, aircraft acquisition, and unpredictable passenger loads. Industry executives also point to critical infrastructure gaps. A major issue is the lack of slots and connectivity at major hub airports like Delhi and Mumbai, which are essential for regional airlines to create a sustainable network. Furthermore, many designated UDAN airstrips have not been upgraded in time, preventing airlines from launching services even after being awarded a route.
The Bigger Picture: Measuring UDAN's True Impact
Focusing solely on discontinued routes misses the scheme's transformational impact. Since its launch, UDAN has successfully connected dozens of previously unserved or underserved airports, from Darbhanga to Jharsuguda. It has operationalised hundreds of routes and enabled more than 16 million passengers to fly, many for the first time. The number of operational airports in India has expanded significantly, laying the groundwork for future growth. The scheme has also boosted regional tourism and economic activity in places that were previously hard to reach. While not every route has succeeded, the overall network has fundamentally changed India's aviation map, making air travel more inclusive.
What Comes Next: Acknowledging Challenges, Refining the Model
The government is not blind to these challenges. In response to the high discontinuation rate, a new phase of the scheme, sometimes called 'Viksit UDAN', has been launched with a significantly higher financial outlay. Key changes include extending the subsidy period from three years to five to give routes more time to mature and increasing the funds available for VGF. There is a renewed focus on ensuring airport readiness before routes are awarded and on developing a more robust ecosystem for regional carriers. The government is effectively learning from the first several years of the scheme, acknowledging that while the vision was correct, the execution requires constant adjustment to balance ambition with economic reality.
