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Bids Invited for 4 Airports, Airstrips in Andaman & Nicobar and Lakshadweep Islands: Ministry of Civil Aviation

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With a focus on connectivity of Islands, UDAN 4.0 scheme under the Ministry of Civil Aviation (MoCA) has invited bids for 3 unserved airports, airstrips in Andaman & Nicobar Island and 1 underserved airport, airstrip in Lakshadweep Island. The ministry has also recognized 4 Water Aerodromes locations in Andaman & Nicobar Island and 2 in Lakshadweep Island that is up for bidding. The efforts are in the direction to provide aerial connectivity to the region. The move will not only boost tourism but will also transform the economic situation of the region. Under the UDAN 4.0 scheme, MoCA is also providing additional Viability Gap Funding (VGF) of around 25% to the airlines.

The route connecting “Cochin – Agatti” is currently operated by Alliance Air. The Ministry of Home Affairs aiming to promote the route Cochin-Agatti-Cochin further, intends more airlines to operate this route. Accordingly, as an exception to the Scheme, the Cochin-Agatti route has been incorporated under the current version of the Scheme to provide additional connectivity to the island region

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  • List of Unserved Airports / Airstrips up for bidding:
    • Campbell Bay – Andaman &Nicobar(UT)
    • Car Nicobar – Andaman &Nicobar(UT)
    • Shibpur – Andaman &Nicobar(UT)
  • List of Underserved Airports / Airstrips up for bidding:
    • Agatti – Lakshadweep Island        

List of Water Aerodromes up for bidding:

  • Hutbay – Andaman & Nicobar-Unserved
  • Long Island – Andaman & Nicobar –Underserved
  • Neil Island – Andaman & Nicobar- Underserved
  • Havelock – Andaman & Nicobar-Underserved
  • Minicoy – Lakshadweep Unserved
  • Kavaratti – Lakshadweep -Unserved

Other incentives to the airlines:

  • The UT administration will reimburse the VGF amount on Cochin-Agatti-Cochin route.
  • MoCA to bear 90% of VGF and remaining 10% by Andaman & Nicobar Island and Lakshadweep Islands for RCS routes.
  • Excise Duty at the rate of 2% only shall be levied on Aviation Turbine Fuel (ATF), drawn by Selected Airline Operators at RCS Airport(s) for RCS Flights, for three (3) years from the date of notification.
  • Reduction of VAT to 1% or less on ATF at RCS Concession Airports located within the State for a period of ten (10) years from the date of notification.
  • Provision of minimum land, if required, free of cost and free from all encumbrances for development of RCS Concession Airports and also provide multi-modal hinterland connectivity (road, rail, metro, waterways, etc.) as required.
  • Provision of security and fire services free of cost at RCS Concession Airports
  • Provision of, directly or through appropriate means, electricity, water and other utility services at substantially concessional rates at RCS Concession Airports.
  • VGF will be provided for RCS Flights for a period of three (3) years from the date of commencement of RCS Flight operations
  • State Governments, at their discretion, may consider extending any additional support (such as marketing support) for promotion of RCS Flights.

Concessions offered by the Airport / Water Aerodrome / Helipad operators are as follows:

  • Airport / Water Aerodrome / Helipad operators shall not levy Landing Charges and Parking Charges or any other charges on RCS Flights including ASF / UDF charges among others.
  • Selected Airline Operators shall be allowed to undertake ground handling for their RCS Flights
  • AAI shall not levy any Terminal Navigation Landing Charges (TNLC) on RCS Flights.
  • Route Navigation and Facilitation Charges (RNFC) will be levied by AAI on a discounted basis @ 42.50% of Normal Rates on RCS Flights.

MoCA aims to operationalize 1000 routes and more than 100 airports in the next five years. This would be achieved by focusing on operationalizing routes in Priority Areas. AAI would focus on developing the no-frills airport in the future and routes connecting such airports would be prioritized for the award of VGF. The market would be incentivized to develop short-haul routes only, providing connectivity to nearby airports.

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