Modified UDAN: Expanded Funding and Extended Subsidies for Regional Aviation The Union Cabinet has approved a revamped version of the UDAN programme, now termed Modified UDAN . The new plan raises the outlay six times and extends the subsidy horizon, aiming to address the chronic fragility of India’s regional aviation sector. Key Developments Subsidy period for tier‑II and tier‑III routes extended from 3 years to 5 years . Government will fund subsidies directly, eliminating the need for airlines to levy extra charges on passengers. Allocation of ₹10,043 crore over the next decade for direct subsidies. Investment of ₹12,159 crore to redevelop 100 unused airstrips . Allocation of ₹3,661 crore for construction of 200 helipads in remote locations. Purchase of aircraft and helicopters for state carriers to improve last‑mile connectivity . Funding for staffing and maintenance of low‑traffic airports. Important Facts The scheme’s total outlay now exceeds ₹26,000 crore , a sixfold rise from the original UDAN budget. Direct government subsidies aim to reduce ticket prices without passing costs to passengers, addressing a key criticism of the earlier model. The focus on airstrip redevelopment and helipad construction reflects the need for basic infrastructure before commercial operations can become viable. UPSC Relevance Understanding regional aviation is essential for GS‑III (Economy) and GS‑II (Polity) questions on transport policy, infrastructure financing, and public‑private partnerships. The scheme illustrates: How fiscal policy (direct subsidies) is used to correct market failures in high‑cost sectors. The interplay between central ministries ( Civil Aviation Ministry ) and state carriers. Challenges of demand‑side constraints, competition from rail and road, and the importance of multimodal integration. Way Forward For the scheme to achieve lasting impact, the government must: Re‑evaluate route selection based on robust demand‑forecasting and economic activity. Integrate air services with existing rail and road networks to ensure seamless multimodal transport solutions. Encourage private participation through viable business models rather than prolonged subsidies alone. Monitor and publicly report on utilisation, cost recovery, and socio‑economic benefits of each route. Only by aligning infrastructure development with genuine market demand and broader transport planning can regional aviation move from a subsidy‑dependent model to a sustainable component of India’s connectivity framework.