Stocks to watch after Gov plans to open multiple airports under UDAN scheme

Stocks to watch after Gov plans to open multiple airports under UDAN scheme


Prime Minister Narendra Modi recently inaugurated three airports developed under the Regional Connectivity Scheme (RCS) – UDAN (Ude Desh Ka Aam Nagrik). These airports, located in Rewa, Ambikapur, and Saharanpur, mark another milestone in India’s efforts to enhance air connectivity across the nation. Flights from these airports will commence shortly, further expanding the reach of air travel to more regions of the country. 

The RCS-UDAN scheme, now in its seventh year, has been a cornerstone of India’s National Civil Aviation Policy. Launched in 2016 by the Ministry of Civil Aviation, this initiative aims to improve infrastructure and connectivity, especially in remote and underserved areas. UDAN 1.0 kicked off the initiative, awarding 128 flight routes to 70 airports, including 36 newly operational ones. UDAN 2.0 expanded the scope by announcing 73 underserved and unserved airports and, for the first time, included helipads in the connectivity plan. UDAN 3.0 brought tourism routes into the fold, coordinating with the Ministry of Tourism. It also introduced seaplanes for connecting water aerodromes and focused on routes in the North-East Region. UDAN 4.0 gave further impetus to North-Eastern Regions, Hilly States, and Islands, incorporating helicopter and seaplane operations. The scheme has since progressed to UDAN 5.0, with subsequent sub-versions up to 5.4, each refining and expanding the program’s reach. 

Fueling Growth in the Aviation Industry 

The impact of RCS-UDAN on India’s aviation industry has been significant. It has fostered the growth of new and successful airlines over the past seven years. The scheme has provided a platform for airline operators to establish sustainable business models. Small regional airlines like Flybig, Star Air, IndiaOne Air, and Fly91 have found opportunities to scale up their operations, demonstrating the scheme’s success in creating a favorable ecosystem for airline businesses. 

Demand for new aircraft of all sizes 

As the scheme expands, it’s generating an increasing demand for new aircraft across various sizes. The fleet serving RCS routes now includes a diverse range of aircraft, from small propeller planes to large commercial jets, and even helicopters and seaplanes. This growing demand is reflected in the substantial orders placed by Indian carriers, exceeding 1,000 aircraft scheduled for delivery over the next 10-15 years. This represents a significant expansion of India’s current fleet of approximately 800 planes. 

Promoting tourism

Beyond improving connectivity, RCS-UDAN is playing a crucial role in boosting India’s tourism sector. UDAN 3.0 introduced tourism routes connecting several destinations in the Northeast region, while UDAN 5.1 focuses on expanding helicopter services in hilly regions to stimulate tourism, hospitality, and local economic growth. The scheme has successfully connected destinations of religious significance such as Khajuraho, Deoghar, Amritsar, and Kishangarh (Ajmer). The entire Northeast region is experiencing a tourism boom thanks to the introduction of airports in Pasighat, Ziro, Hollongi, and Tezu. The scheme has also put Agatti Island on the Indian aviation map, further boosting tourism in Lakshadweep. 

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Boosting air connectivity 

The reach of RCS-UDAN spans the entire country, from Mundra in Gujarat to Tezu in Arunachal Pradesh, and from Kullu in Himachal Pradesh to Salem in Tamil Nadu. It has connected 34 States/UTs across India, operationalizing a total of 86 aerodromes. In the Northeast region alone, ten airports and two heliports have been made operational. The success of RCS-UDAN in improving last-mile connectivity is evident in its widespread impact. It has not only made air travel accessible to residents of tier-2 and tier-3 cities but has also opened up new avenues for economic growth in these regions. 

Conclusion 

As RCS-UDAN continues to evolve and expand, it is reshaping India’s aviation landscape. By making air travel more accessible and affordable for the common citizen, it is fulfilling its namesake promise of enabling the common citizen of the country to fly. The scheme’s success demonstrates the government’s commitment to inclusive growth and development, ensuring that the benefits of air connectivity reach every corner of the nation. As more routes are added and new airports are developed, RCS-UDAN is set to play an increasingly important role in India’s journey towards becoming a major global aviation hub. 

Written By: Dipangshu Kundu

Disclaimer

The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.


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