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Draft regional connectivity scheme for airlines (Relevant for GS Prelims, GS Mains Paper III)

The civil aviation ministry released the draft regional connectivity scheme in a bid to make flying affordable and to revive dormant airports.
Once the scheme is implemented, passengers will be able to fly an hour’s journey (of about 500 km) for an all-inclusive fare of Rs 2,500. The passenger service fee and user development fee will not be 

Who will be eligible for subsidy?
1. The cap on the airfares will be applicable only to a limited number of seats in an aircraft and the passengers will be eligible for subsidised fare on a first-come-first served basis. Subsidised fares will be applicable only on nine seats (for 12 to 18-seater plane) and 40 seats (for aircraft with 80 or more seats).

2. Only routes covering a distance of 200-800 km connecting a ‘less connected or unconnected’ airport will qualify for the regional connectivity scheme and the airfare cap will be proportional to the air distance travelled.

3. Airfares will be capped in the range of Rs.1,700-Rs.4,070 and will be revised every quarter based on the prevailing inflation rate.
4. While the scheme will be applicable to airports with no flight connections in the previous two flying seasons, the government has identified 16 airports, receiving seven flights a week, which will also fall under the scheme.
Some of them are: Agra, Allahabad, Pantnagar, Diu, Shillong, Jamnagar, Bhavnagar, Kullu, Tezpur, among others.
5. The airlines will be mandated to fly at least three flights every week on such regional routes and the subsidy will be provided for maximum seven flights per week.

How much will be Subsidy given by government?
While the Centre will provide 80 per cent subsidy to airlines for three years to fund the losses they incur, to enable them to charge lower airfares to passengers, the remaining 20 per cent will come from the states.

How the subsidy will be financed?
The Centre will set up a regional connectivity fund, to be be financed by a cess charged to airlines flying on metro or trunk routes for each departure.
The cess, which will likely be levied beginning August 1, may marginally increase airfares on such routes.
If an airline is not able to develop a route within three years even after (our) giving viability gap funding, then it will be given a cooling off period of two years before the route can again qualify to become a part of the scheme.



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