Why These Tier-3 UDAN Airports Are Struggling To Take-Off — And What Ayodhya Got Right

The Delhi-Gorakhpur flight often looks like a homecoming for many Indians returning from abroad, particularly migrant workers.

On one such flight taken by the author for this report, a group of 20–25 men carrying passports and travel documents stood in the boarding queue—making up nearly half the passengers on board.

On asking one of the members while boarding, Sushil Kumar, said, “I am coming from Kuwait for a family wedding in my village. After landing in Gorakhpur, I will head to Deoria, which is another 70 kms.”

He added that the rest of the group were also returning from various Middle-eastern countries.

“We have just booked the ticket through the same agent. They will reach Gorakhpur and then take buses or trains to their homes in Purvanchal region or the neighbouring areas of Bihar. There is still one more day of travel left for many.”

“My brother is also on his way, but he landed in Mumbai and will take the flight to Gorakhpur from there. I have to coordinate with him, so we can take the bus together from Gorakhpur”, Sushil added.

According to him, “This is a common sight on all flights to Gorakhpur from Delhi, as large number of people from the surrounding Purvanchal UP and Bihar migrate to middle eastern countries for work.”

The only easy connections to international airports in India are through Delhi, Mumbai, or Kolkata. After that, they can fly to Patna, Lucknow, or Gorakhpur, before heading home.

To address this gap, the government developed Kushinagar International Airport under the Regional Connectivity Scheme as a greenfield project.

Bharat, another member of the group, tells Swarajya, “The opening of the Kushinagar airport was very helpful for connectivity. We were hoping to get direct flights to Kushinagar from other countries. It is also a major destination for international Buddhist pilgrims.”

“But just opening the airport was not enough. No international flights have started at Kushinagar yet, and the one flight that had started from Delhi has also stopped. The airport has had zero flights since last year”, he adds.

Kushinagar International Airport, was inaugurated in October 2021 as one of 12 new greenfield airport projects under the centre’s Regional Connectivity Scheme (RCS-UDAN) scheme.

The airport was officially opened by Prime Minister Narendra Modi, with UP Chief Minister Yogi Adityanath, and officials from 12 countries, including a special Sri Lankan delegation led by Minister Namal Rajapaksa.

It was built to connect eastern Uttar Pradesh with bordering Bihar districts like Gopalganj, Siwan, and West Champaran, and is also expected to serve Buddhist pilgrims.

This report looks at the outcomes of the Regional Connectivity Scheme (RCS), focusing on the development of routes and airports, and its response with cases like Kushinagar.

But first let’s first take a quick look at the scheme’s bigger achievements, before getting back to the specific cases of airports and routes to understand the challenges and way forward.

India’s Regional Air Connectivity Goals

Launched in 2016, the Regional Connectivity Scheme (RCS) – UDAN (Ude Desh Ka Aam Nagrik) aimed to improve connectivity on unserved and under-served routes while making air travel more affordable.

Regional connectivity has been crucial to India’s aviation growth, as it aims to open up socio-economic potential for many areas by bringing them onto the aviation map.

The RCS began its operations on 27 April, 2017, with the first flight between Shimla and Delhi.

The scheme was planned for 10 years with Rs 4,500 crore allocated for revitalising unused and underused airports across the country. An additional Rs 1,000 crore was earmarked for 2023-2026.

Financial support was also provided to airlines through viability gap funding (VGF) and the Regional Connectivity Fund (RCF), encouraging airlines to continue operating on less profitable routes. The aim was to make routes financially sustainable through market competition and initial government support.

Under the scheme, participating airlines receive a subsidy to offer 50 per cent of their seats at a discounted fare. The RCS subsidy is funded by a levy on non-UDAN flights. The approach is to keep fares affordable—typically around Rs 2,500 for a one-hour journey.

Efforts to improve regional air connectivity in India have been ongoing for years. Before the Regional Connectivity Scheme (RCS), the Route Dispersal Guidelines (RDGs) governed traffic distribution.

In 2011, the Rohit Nandan Committee supported the fund but suggested retaining RDGs and using passenger load factors for subsidies. In 2013, the Ministry of Civil Aviation engaged a consultant to recommend actions for boosting regional and remote area connectivity. These collective recommendations shaped the policy framework for promoting regional air services, under the National Civil Aviation Policy 2016.

Over the past eight years, the RCS-UDAN Scheme has evolved in phases to improve regional air connectivity in India.

UDAN 1.0, launched in 2017, awarded 128 flight routes and established 36 new airports.

UDAN 2.0 expanded to include helipad connectivity and underserved airports.

UDAN 3.0 introduced tourism routes, seaplanes, and focused on North-East India.

UDAN 4.0 extended services to hilly regions, islands, and helicopters.

UDAN 5.0 series (5.0 to 5.4) brought significant improvements, removing distance caps, prioritising operational airports, boosting helicopter and small aircraft connectivity, and reactivating discontinued routes.

The Growth Under Regional Air Connectivity

According to government data, the UDAN scheme has successfully operationalised 619 routes and 88 airports, by the end of 2024.

As of March 31, 2024, a total of 1.36 crore domestic passengers had travelled under the RCS-UDAN scheme, up from 1.17 crore the previous year. The number of RCS-UDAN flights reached 2.62 lakh (up to March 31, 2024), as per annual report released by the Airports Authority of India (AAI).

During 2023–24, approximately Rs 777.78 crore was disbursed as Viability Gap Funding (VGF) by the Regional Air Connectivity Fund Trust (RACFT) to Selected Airline Operators (SAOs). In the same period, around Rs 340.99 crore was collected through the RCS levy.

Additionally, claims towards VGF from State Governments and the Ministry of Tourism amounted to Rs 316.20 crore, as per data from the Airports Authority of India (AAI).

Western India’s passenger numbers grew by 29.2 per cent, though its share dropped to 26.2 per cent. In contrast, eastern India’s share edged up from 9.5 per cent to 10.5 per cent, driven by a 66.4 per cent surge in traffic.

The north-east saw the fastest growth, with its share doubling from 0.9 per cent to 1.9 per cent and a 208 per cent rise in passengers.

Under the scheme, regional airports like Darbhanga saw major growth. Darbhanga Airport’s passenger traffic increased fourfold, from 1.53 lakh in 2020–21 to 6.2 lakh in 2021–22. Similarly, Bagdogra and Guwahati airports have also experienced substantial growth in passenger numbers since joining the scheme.

But, Not All Airports and Routes Share the Boom

Over the last eight years, while numerous routes and airports have been launched, many continue to operate with limited flight schedules—often just one or two flights daily—and attract minimal passenger traffic.

Thus, the scheme has also faced challenges, including operational inefficiencies, underutilisation of airports, discontinued routes, and airlines shutting down­—raising concerns about the long-term viability of these operations.

Data available with AAI highlights negative growth trends in air traffic at several airports inaugurated in the year 2021 and later.

In the same year, 12 airports were operationalised, including three heliports.

The table below presents total aircraft movement data for four of these airports across four financial years—from 2021–22 to 2024–25—along with year-over-year percentage changes.

These airports and most of its routes, launched under the UDAN scheme in 2021, have now completed their three-year Viability Gap Funding (VGF) support period.

Between 2021–22 and 2024–25, Kushinagar Airport, initially saw a strong rise in aircraft movement—recording 92.4 per cent growth in its first year. However, this early momentum did not last. Over the next two years, traffic dropped sharply, with a combined decline of over 84 per cent.

Kurnool showed more modest figures—starting with a 14.5 per cent increase, but then gradually tapering off with a total decline of around 33.9 per cent over the next two years.

Several factors hindered this growth—chiefly delays and flight cancellations due to slot constraints, limited aircraft availability, reliability issues that dampened passenger demand, and the withdrawal of services after the three-year Viability Gap Funding (VGF) period ended.

According to a report submitted in the Rajya Sabha in February 2025, of the total 619 routes operationalised under the UDAN scheme, only 323 are still in operation. This also includes the routes that have become commercially viable, after the three-year tenure.  

To date, 88 airports have been opened under the scheme, with the highest concentration in Uttar Pradesh, Gujarat, and Uttarakhand (including heliports).

Case Of A Discontinued Route

In October 2024, Alliance Air suspended its flight operations between Sindhudurg and Mumbai.

Launched in October 2021, with the opening of Chipi Airport in Sindhudurg, it was the first flight to connect Sindhudurg to the rest of the country. Even though the passenger demand was good, operations were discontinued as the airline’s three-year contract under the UDAN scheme came to an end.

Chipi Airport was developed with substantial investment from both the state and central governments. The flight offered a quick 50-minute connection over a distance of 530 km, and the airport was aimed to get 20–25 flights within five years.

Officials at Alliance Air tells Swarajya, “The Mumbai-Sindhudurg flight received strong response under the subsidised pricing model. Of the 70 available seats, 35 were supported by government subsidy. With a buffer for cancellations, 40 seats were priced under the cap, while the remaining were sold at commercial rates.”

“However, the passenger demand continued on the concessioned ticket pricing, while the commercial pricing did not see similar demand. Once the VGF support ended and all seats were priced commercially, demand dropped significantly and the route had to be discontinued.”, the official adds.

Many such routes for Alliance Air and other airlines has faced similar fates.

As per the Comptroller and Auditor General (CAG) report in 2023, only seven per cent of routes under the RCS-UDAN scheme managed to sustain operations beyond the initial three-year concession period.

For Alliance Air specifically, out of 165 routes awarded, 141 became operational, but as of now, only eight have continued beyond the concession period as viable commercial routes.

Airports With Low-Traffic

Circling back, a similar situation was observed with Kushinagar Airport. After its inauguration, the first—and the only—commercial flight was launched by SpiceJet on 26 November, 2021, operating on the Delhi-Kushinagar route.

However, after initially meeting the passenger demand, operational challenges soon began to surface.

While delays were infrequent at first, they gradually became more common. The airport’s runway supports only VFR (Visual Flight Rules) operations, which poses limitations—especially during poor weather. Combined with limited aircraft availability, these factors led to recurring operational issues for the airline.

“Reliability is crucial for the sustainability of any air route. Frequent delays and cancellations led to a major loss of trust among passengers,”, official at Kushinagar Airport tells Swarajya.

“I am a personal use case of this issue while traveling from Delhi to Kushinagar for my posting.”, he adds.

As a result, passenger demand started declining. People preferred to take flights from Gorakhpur Airport, where carriers were operating regular and dependable services, or went back to modes they had used prior to this airport’s launch.

In December 2023, SpiceJet discontinued the service—even before the completion of the three-year support period.

Kushinagar Airport, was the third international airport in Uttar Pradesh, built to serve various needs. The town of Kushinagar is a major pilgrimage site where the Buddha is believed to have attained Mahaparinirvana (final salvation) around 483 BCE.

In 2016, the Ministry of Tourism launched the Buddhist Circuit as India’s first transnational tourism route. It connects key Buddhist sites across India, Nepal, and Sri Lanka.

In India, this includes Bodh Gaya, Vaishali, and Rajgir in Bihar, as well as Kushinagar, Sarnath, and Shravasti in Uttar Pradesh. Lumbini in Nepal, the birthplace of the Buddha, is also part of the circuit.

While Gorakhpur, the nearest operational airport, serves as a defence airport with limited civilian utility, the development of Kushinagar Airport was seen as essential to support regional tourism and connectivity.

As per Archaeological Survey of India (ASI), Kushinagar sees more than 50,000 foreign visitors monthly, during the months of September to April. The region has monasteries established by countries — Cambodia, Japan, Thailand, Sri Lanka, Nepal, Myanmar — with demand of direct flights from all across south-east Asia.

Additionally, as per airport officials, there have been demands for direct connectivity with countries in the Middle-East. Airlines are also looking for flights from Delhi, Mumbai, and Bengaluru.

When the airport was formally commissioned for operations, a new terminal building was constructed in six months, and all essential licensing parameters were met to initiate basic functioning.

But after SpiceJet discontinued its flight, no other commercial flights have taken place from the airport.

Even though interest from airlines like IndiGo, Akasa, and JetWings was there, none of them have started operations.

One major reason is that the airport only supports VFR (Visual Flight Rules), which means flights can only land or take off in clear weather with at least 5 km visibility.

“This is a big limitation, especially during fog or rain, or at night. Airports with IFR (Instrument Flight Rules) systems—like Delhi, Lucknow, and Jaipur—have advanced tools which allow planes to land even in low visibility.”, an airline official tells Swarajya.

It includes precision approaches like ILS (Instrument Landing System) and non-precision approaches like VOR and NDB. Precision systems offer exact lateral and vertical guidance, improving safety, reducing delays, and enabling consistent landings in adverse weather.

“Airlines prefer airports with IFR systems because they offer safer and more reliable landings during bad weather or fog, which is common in North India during winters,”, he adds.

In recent years, Uttar Pradesh has dominated in airport development under the Regional Connectivity Scheme (RCS).

Apart from Kushinagar, several new airports have been made operational across the state. The state has also seen the opening of airports such as Ayodhya and Hindon.

Further in 2024, the Prime Minister inaugurated and laid the foundation stone for 15 airport projects across India, with a total value exceeding Rs 9,800 crore.

This included a group of airports in Uttar Pradesh—Azamgarh, Chitrakoot, Shravasti, Aligarh, and Moradabad.

While Ayodhya and Hindon airport have shown promising performance with consistent flight operations and growing passenger numbers, others continue to struggle.

Azamgarh, Aligarh, Chitrakoot, and Moradabad have seen very limited flight activity and low operational frequency since its inauguration.

Between April and February of FY 2024–25, Hindon Airport emerged as a leader with 40,714 passengers and 2,576 aircraft movements, surpassing other airports like Aligarh (1,239 passengers; 238 movements) and Chitrakoot (1,202 passengers; 202 movements).

Azamgarh and Moradabad saw lower figures, with 956 and 549 passengers, respectively. Kushinagar only handled 270 passengers and 44 movements.

In comparison, similar regional airports such as Darbhanga and Deoghar recorded 3,205 and 2,771 movements, respectively.

Though many of these airports have been operational for just a year, they display wide variation in performance, and offer early indications of the steps needed to improve the performance.

Moradabad Airport was built at a cost of Rs 28.93 crore on 128 acres of land. It took five months after construction for flight services to begin, with the first flight to Lucknow launched in August 2024.

As per reports, since then, only 45 flights have been operated. Initially, flights were scheduled three days a week, later increased to six, but due to a shortage of aircraft, services were reduced again to three days.

A similar situation exists for Aligarh. The Dhanipur airport in Aligarh covers 69.28 acres and features a terminal building spread over 1,250 square meters. The project cost is estimated at Rs 29.40 crore.

Aligarh’s location also poses challenges—it is only about 100 km from Agra Airport and also within reach of Delhi Airport, which reduces its necessity for air travel.

The core issue remains the absence of advanced landing systems. Without them, flights cannot land safely in fog or poor weather, making regular operations difficult during such conditions.

Another issue mentioned by the officials at these airports, “These regional airports handle small aircraft with a capacity of around 18 passengers. However, very few airlines in India operate such small aircraft, which limits the number of scheduled flights. As a result, air traffic at these airports remains low.”

Some private aircraft do continue to land occasionally, but this has not been enough to sustain regular commercial operations.

Operational And Revenue Challenges For Low Traffic Airports

Even with low demand, these airports have to be operational, which creates a continuous cost of staffing—security, maintenance, operations, ATC staff, firefighting services, and general airport staff—along with indirect costs.

These costs as per an official, reaches to crores monthly for each airport. The maintenance of infrastructure also continues to drive up expenses.

This expenditure makes these airports a loss-making asset for the Airport Authority of India (AAI) as well as for both state and central governments.

Achieving the level of infrastructure seen at tier-1 or even tier-2 private airports demands far more advanced upgrades—something that hinges on the airport’s ability to generate sustained revenue. An airport official tells Swarajya, “When flight traffic is low, it also hampers the alternate potential for revenue generation. Even basic airport upgrades, such as improved facilities for staff, passenger amenities, parking, and overall development, remain restricted.”

Non-traffic revenue comes from food and beverages, parking fees, space rentals, advertising, and other commercial activities within the airport and surrounding areas.

With the existing infrastructure, revenue and operational challenges continue for most regional airports, as they are unable to make use of any of the revenue streams.

Issue with parking and slot issues are also common. “Slots are dependent on demand, with peak hours generally in the morning and evening. For remote routes, these slots are crucial—tourists, business travellers, and services all depend on them,”, Alliance air official tells Swarajya.

But if only one or two parking spots are available, operational issues arise. Furthermore, if a flight is delayed on a previous route, cancellations are more likely due to runway limitations, which affects the reliability of the route.

Thus, these operational and expansion challenges continue to affect most regional airports, where more attention is needed for the effective use of resources and infrastructure.

Planning For Long-Term Sustainability Of Regional Air Links

The government’s push to enhance regional air connectivity through airport development has laid a crucial foundation, connecting previously under-served regions to the broader air network.

This remains a cornerstone for unlocking unlocked fresh opportunities for tourism, business, and local economic growth.

However, now that the infrastructure is in place, the focus must shift to ensure that these airports are used effectively and remain sustainable in the long run.

Inputs from aviation experts, airline operators, and airport authorities highlight some crucial steps required for long-term sustainability—reliable flight operations, alternative traffic opportunities, effective route and airport marketing, policy advancements based on learnings, extended support to airlines, and a reimagined approach to connectivity.

One, linking tier-3 regional airports directly to metro cities or airline hubs. These routes serve a dual demand — people from smaller towns traveling to metro cities, and business travellers needing quick access from tier-1 to tier-3 locations.

Currently, a lack of connectivity to major hubs increases the rate of flight cancellations. While unavoidable cancellations due to technical issues or weather are common across airlines, the more concerning issue is the avoidable cancellations that occur when there are no alternative flights available — especially at non-hub airports.

“If a flight is delayed or cancelled at a non-hub airport, due to any reason, passengers are left without options. While flights connected through major hubs offer better chances of rebooking or rerouting.”, says an airline official.

Aviation experts also note that the scheme performs best for longer routes where air travel saves substantial time. However, on shorter routes — where travel by car can be completed in 4–5 hours on good roads — passengers often choose road over unreliable air service.

Two, working on equipment upgrades on most tier-3 airports.

An airport official tells Swarajya, “Take example of Ayodhya airport. It had all the necessary facilities, equipment, and infrastructure in place before its flight operations began, ensuring no issues with landing systems, traffic control, or management.”

“In case of Kushinagar airport, the airport began operations early. Runway is still operating under VFR, while the plans to convert it to Instrument Flight Rules (IFR) and further develop its infrastructure are in place but not installed after its launch. The equipment required for precision operations has already arrived from Russia, but progress is delayed due to ongoing land disputes in court.”, he adds.

Pre-planning and infrastructure improvements, similar to those done for Ayodhya, are essential for smaller airports to avoid limitations with landing slots, parking, and operational challenges.

Three, the three-year incentive could be considered for extension in coordination and sustainability of flight routes.

An aviation expert adds, “the goal was not to have passengers travel just once; the aim was to create a system where air travel is conveniently accessible to everyone."

“The government could consider extending the incentive beyond three years by offering a reduced subsidy,", he adds.  

The extension could be given based on traffic analyses on certain routes, and support can last while traffic is able to drive additional revenue opportunities for airports and airlines.

Four, the management of regional airport operations is currently divided among several authorities, leading to confusion and delays, officials say.

For example, in Kushinagar, responsibilities are split between the Airport Authority of India (AAI) and various departments of the Uttar Pradesh government.

This has fragmented the operations and results in delays, particularly when it comes to improvements proposed for the airport.

Furthermore, this distribution also leads to delays in payments. "These smaller flights, with lower revenue generation, if see payments from the airport authority getting delayed, it impacts funding and the ability to continue operations smoothly,", adds an airline official.  

To resolve this, experts suggest that consolidating responsibility under a single entity or adopting a Public-Private Partnership (PPP) model would streamline operations, ensuring more efficient use of infrastructure and smoother management overall.

Five, it is crucial to focus not only on passenger traffic but also on the cargo capacities and industrial potential of regional airports.

While the aviation infrastructure is in place, it remains underutilised in many areas, where they remain as isolated structures.

Effective marketing of these airports and highlighting their features is necessary to avoid this stagnation.

In addition to cargo, many airports are capable of exploring alternative revenue streams, such as aircraft hangar facilities and flying training centres (FTOs), particularly at airports with land availability.

Moreover, once the necessary infrastructure is in place, regional airports can enhance their revenue potential through commercial promotion of regional cultural assets.

Moradabad, known for its industrial base in brassware manufacturing, offers strong potential for cargo services. The city’s export-oriented industries, particularly brass handicrafts, could benefit from air freight solutions.

However, airport officials in Moradabad report low interest so far, but believe promotion could attract logistics businesses, helping both local companies and international trade.

Similarly, the airport in Aligarh could enhance connectivity to support the region’s industrial and defence sectors.

Aligarh has become an important part of Uttar Pradesh's Defence Industrial Corridor. According to UPEIDA's report, Aligarh has attracted Rs 3,421.40 crore in investment proposals.

Key investors include Ancor Research Labs (Rs 550 crore for drones and electronic warfare equipment) and Amitec Electronic Ltd, which makes Electronic Warfare systems, Signal Intelligence, Radar Systems, and Tactical Communication equipment. With more companies building facilities here, there's a good chance to grow air traffic, especially for defence needs.