Civil Aviation Ministry, along with Airports Authority of India (AAI), today entered into a pact with the Puducherry government for the proposed regional connectivity scheme (RCS).
With the signing of the tripartite Memorandum of Understanding (MoU), Puducherry has formally agreed to provide the concessions required from the state governments under the RCS, a release said today.
The ministry has already signed MoUs with various states, including Gujarat, Maharashtra, Chhattisgarh and Jharkhand and Andhra Pradesh for implementation of RCS.
The government expects the first flight under RCS, which is in advanced stages of finalisation, to take off in early January 2017, Civil Aviation Minister Ashok Gajapathi Raju had said last week.
Minister of State for Civil Aviation Jayant Sinha, who was present during the signing of the agreement, hoped that the subsidies offered under the RCS would attract airlines which also needed to find the appropriate aircraft and pilots to service the regional sector.
Puducherry Chief Minister V Narayanaswamy said his government was happy to cooperate in promoting RCS as it would improve the connectivity to the Union Territory.
The scheme seeks to provide air services between un-served and under-served areas and is part of larger plans to boost the domestic aviation sector, which is clocking over 20 per cent passenger growth over the last several months.
A slew of incentives are being proposed under RCS, including Rs 2,500 cap on airfare for one-hour flights. The airlines operating flights under RCS will be extended a viability gap funding (VGF), while the states concerned are required to offer certain concessions such as providing police and fire services free of cost.
The partner state governments would also contribute a 20 per cent share to this fund (10 per cent for northeastern states). For balanced regional growth, the allocations under the scheme would be equitably spread across the five regions -- North, West, South, East and Northeast.
VGF will be created by way of charging a small levy per departure on all domestic flights on certain routes and small aircraft with less than 80 seats. The central and the state governments will be sharing the VGF amount.
There are 394 un-served and 16 under-served airports. State-run AAI had recently said that as many as 20 un-utilised airports are ready to start operations for regional flights.
The states have been given a key role under the scheme. The selection of airports where RCS would be implemented will be done in consultation with state government and after confirmation of their concessions.
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