Incentives For International Flights To Andamans: AAI Makes Big Move On User Development Fee To Bridge Viability Gap

Airports Authority of India (AAI) has rolled out a comprehensive incentive scheme at 13 airports, including Veer Savarkar International Airport in Port Blair, Andaman and Nicobar Islands, according to a PTI report.

The initiative aims to bridge the viability gap during the critical initial phase of operations, especially for international routes.

This scheme will be applicable for the first three years of operations to bridge the viability gap for the initial phase, which is a very crucial phase for the sustainability of operations.

Under the scheme, airlines operating international flights will be given a complete waiver of User Development Fees (UDF) for the first year, which stands at Rs 709 per departing passenger. The second and third years will see incentives of 85 per cent and 65 per cent respectively.

Considering the flight load of 180 passengers, the incentive scheme has the potential of savings of Rs 128 lakh per flight for airlines, which is a significant amount to bridge the viability gap, said Devender Yadav, Airport Director, Port Blair.

The first scheduled international flight commenced on 16 November, 2024, with AirAsia operating between Kuala Lumpur and Port Blair. However, due to low passenger volumes, the route was discontinued from 10 April, 2025.

Yadav welcomed AAI’s move, stating, "The incentive scheme for international flight operations by AAI management is a welcome move as it is going to promote tourism significantly in the archipelago."

He further added, "Now, we are better prepared for sustainable international flight operations with this incentive scheme and readiness to swing international cargo operations."

Veer Savarkar International Airport has received the highest incentive allocation among the 13 selected airports.

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