India has launched the Modified UDAN Scheme (Ude Desh ka Aam Nagrik) with a total outlay of ₹28,840 crore, targeting the construction of 100 new airports and 200 modern helipads to deepen regional air connectivity across the country, according to an official factsheet released on Friday, 17 July 2026. The revamped scheme marks the next phase of India's regional aviation push, building on a decade of expansion that has already more than doubled the country's operational airport count.

A Decade of Growth, and What Comes Next

The original Regional Connectivity Scheme (RCS) – UDAN, launched in October 2016, was designed to make air travel affordable and accessible, particularly in underserved regions. Its impact has been significant: the number of operational airports in India rose from 74 in 2014 to 165 as of 15 July 2026. India now ranks as the third-largest domestic aviation market globally. The modified scheme seeks to consolidate these gains and address infrastructure gaps that remain in smaller and geographically challenging markets.

Key Components and Funding Breakdown

The largest single allocation under the Modified UDAN Scheme is ₹12,159 crore earmarked for the development of 100 airports from existing unserved airstrips over the next eight years. An additional ₹2,577 crore has been set aside for Operation and Maintenance (O&M) support for approximately 441 aerodromes over a structured three-year period, capped at ₹3.06 crore per annum per airport and ₹0.90 crore per annum per heliport or water aerodrome.

The scheme also proposes 200 modern helipads in priority regions where conventional airport infrastructure is not feasible due to geographical constraints, at an estimated cost of ₹15 crore per helipad — a total projected outlay of ₹3,661 crore over eight years. These helipads are intended to improve access to healthcare, support emergency response, and facilitate economic activity in remote areas.

Viability Gap Funding to Sustain Airline Operations

To encourage airlines to serve smaller, commercially unviable routes, the scheme continues its Viability Gap Funding (VGF) mechanism, with ₹10,043 crore proposed over a ten-year period. Airlines will receive funding support for up to five years, with a tapered disbursement structure beginning from the third year. Route exclusivity will be limited to three years, a design intended to gradually shift routes toward commercial sustainability without creating permanent subsidy dependence.

Atmanirbhar Bharat Push in Aviation

The Modified UDAN Scheme also incorporates an indigenous manufacturing angle under the Atmanirbhar Bharat initiative. The scheme proposes the procurement of two HAL Dhruv helicopters for Pawan Hans and two HAL Dornier aircraft for Alliance Air — both platforms designed for operations in challenging terrain and intended to support domestic aerospace manufacturing capability.

What This Means for Connectivity and Citizens

The scheme's multi-pronged approach — combining infrastructure creation, operational subsidies, and indigenous aircraft induction — signals a more comprehensive strategy than earlier UDAN rounds, which were primarily VGF-driven. Notably, the inclusion of helipad development and O&M support addresses two persistent gaps: last-mile connectivity in mountainous and island regions, and the financial unviability that has historically led airlines to exit regional routes after the exclusivity window closes. How effectively the government enforces route commitments and monitors disbursement milestones will determine whether this ₹28,840 crore bet translates into durable connectivity gains.