Published: 25 March 2026PIB / PM India / DD News / Business StandardGovernance
Union Cabinet Approves Modified UDAN Scheme with ₹28,840 Crore Outlay for 10 Years (FY 2026–27 to FY 2035–36)
AQuick answer
Union Cabinet on March 25–26, 2026 approved the Modified UDAN scheme with ₹28,840 crore outlay for FY 2026–35, covering 100 new airports, 200 helipads, and VGF support for regional air routes, aiming to connect Tier-2/3 cities, hilly areas, and aspirational districts.
On March 25–26, 2026, the Union Cabinet chaired by Prime Minister Narendra Modi approved the Regional Connectivity Scheme – Modified UDAN (Ude Desh ka Aam Nagrik) with a total outlay of ₹28,840 crore to be implemented over 10 years from FY 2026–27 to FY 2035–36.
Key allocations under the scheme include: Airport Development — 100 airports will be developed from unserved airstrips with an outlay of ₹12,159 crore over eight years; Viability Gap Funding (VGF) — ₹10,043 crore over 10 years to provide financial support to airline operators on unviable regional routes; Operations and Maintenance Support — ₹2,577 crore for around 441 aerodromes at a cap of ₹3.06 crore per annum per airport; Helipad Development — 200 modern helipads at ₹1.5 crore each.
The scheme aims to bring air connectivity to Tier-2 and Tier-3 cities, hilly regions, islands, and aspirational districts. As of 25 March 2026, 663 routes had been operationalised across 95 airports, heliports and water aerodromes under UDAN. The modified scheme also targets helicopter and seaplane services to remote areas. For Rajasthan, UDAN connectivity is critical for cities like Kota, Bikaner, Jaisalmer, and Barmer, which lie in aspirational or industrially significant districts.
0Mains angle
Q: Evaluate the Modified UDAN scheme approved in March 2026 for its role in regional air connectivity, with focus on its budget architecture and relevance for Rajasthan.
Answer (50 words):
Cabinet approved Modified UDAN on 25-26 March 2026 with ₹28,840 crore outlay over FY 2026-27 to 2035-36: ₹12,159 crore for 100 unserved airports over eight years, ₹10,043 crore VGF, ₹2,577 crore operations for 441 aerodromes, plus 200 helipads at ₹1.5 crore each. Since 2016, 601 routes connected 88 airports.
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Practice MCQ from this story
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Linked questionMedium
What is the total outlay approved by the Union Cabinet for the Modified UDAN Scheme over 10 years from FY 2026-27 to FY 2035-36?
Explanation · Correct answer DThe Union Cabinet approved the Modified UDAN Regional Connectivity Scheme with a total outlay of ₹28,840 crore for 10 years from FY 2026-27 to FY 2035-36.
Frequently asked questions
What is the Modified UDAN scheme approved by the Union Cabinet in March 2026 and what is its financial outlay?
The Modified UDAN (Ude Desh ka Aam Nagrik) scheme was approved by the Union Cabinet on March 25-26, 2026, with a total outlay of ₹28,840 crore for 10 years spanning FY 2026-27 to FY 2035-36. It aims to significantly expand regional air connectivity across India.
What infrastructure targets has the Modified UDAN scheme set for airport and helipad development?
The Modified UDAN scheme targets the development of 100 new airports, 200 helipads, and water aerodromes across India. These infrastructure additions are meant to extend air connectivity to previously unserved and underserved regions, including hilly areas and island territories.
What is Viability Gap Funding (VGF) and how does it make regional air routes commercially feasible?
Viability Gap Funding (VGF) is a government subsidy provided to airlines operating on unserved and underserved regional routes where ticket revenues alone cannot cover operational costs. Under UDAN, VGF bridges this financial gap to incentivise airlines to fly on routes connecting smaller cities and remote areas.
When was the original UDAN scheme launched and how does the 2026 modification differ from it?
The original UDAN scheme was launched in 2016 under India's National Civil Aviation Policy with the aim of making air travel affordable for common citizens. The 2026 modification significantly scales up the scheme's scope, duration (10 years), and financial commitment (₹28,840 crore), with greater focus on infrastructure creation and aspirational districts.
Which regions are the focus areas of the Modified UDAN scheme and what is the rationale for targeting them?
The Modified UDAN scheme focuses on Tier-2 and Tier-3 cities, hilly and remote regions, North-East India, island territories, and aspirational districts. These areas currently have poor air connectivity relative to their population and economic potential, and improved connectivity is expected to boost tourism, trade, and regional development.
