White Elephants on Runway: Silent Airports and UDAN Promise

UDAN scheme succeeded at kick starting connectivity, but it struggled with making thin routes self-propelling once subsidies taper.

By P SESH KUMAR

New Delhi, October 28, 2025 — India has more airports than ever and more flyers than at any time in its history. Yet a sizeable slice of this network sits idle, bleeds cash, or hosts flights so sporadic that terminals echo more than they buzz.

As of 4 August 2025, the government formally listed 22 Airports Authority of India (AAI) airports as “presently non-operational,” while 81 AAI airports posted losses in FY 2024-25.

The UDAN scheme—conceived to democratize flying by linking unserved and underserved regions—has undeniably connected new dots on the map and moved over 1.56 crore passengers, but the Comptroller and Auditor General’s 2023 audit flagged tough truths: over half the awarded routes in early rounds never took off, and only a sliver sustained beyond the concession period.

The Public Accounts Committee (PAC) has pressed the Ministry, Standing Committees have grilled the sector, and the government says it has retooled UDAN with new rounds and guidelines.

The paradox: booming skies, empty terminals

The headline growth is real. India counted 162 airports by 2025-up from 74 in 2014-and domestic traffic has surged. But expansion came with uneven economics. In a written reply to Parliament on 4 August 2025, the Civil Aviation Ministry disclosed that 81 AAI-run airports made losses in FY 2024-25, appending airport-wise cumulative losses for the past decade and a second annexure naming 22 AAI airports that are “presently non-operational.” That list runs from Donakonda and Raxaul to Vellore and Warangal-airfields revived on paper but stranded by absent or vanishing schedules.

Media tallied those decade-long red inks to about ₹10,853 crore across the 81 loss-making AAI airports-an eye-watering reminder that “build it and they will come” is not an aviation strategy. Losses at scale do not just reflect start-up pain; they often signal demand overestimation, airline withdrawals, or infrastructure ready before markets are.

Why these airports exist at all: the UDAN wager

UDAN-Ude Desh ka Aam Nagrik-was launched in October 2016 to make flying affordable and connect small cities. The design married capped fares with Viability Gap Funding (VGF) to airlines and revival grants for airfields, backed by concessions from States and airport operators.

In nine years, the government reported 649 routes operationalized, 93 unserved/underserved airports activated (plus 15 heliports and two water aerodromes), 3.23 lakh UDAN flights, and over 1.56 crore passengers. It also reported over ₹4,300 crore disbursed as VGF to keep routes viable and ₹4,638 crore invested in airport development under RCS-UDAN.

That is the theory-and a good deal of practice. The hitch is longevity. Subsidized liftoff is one thing; surviving without crutches is the metric that matters.

The CAG’s verdict: routes that never flew and routes that didn’t last

The CAG’s Compliance Audit Report No. 22 of 2023 on UDAN, tabled in Parliament on 10 August 2023, looked at Rounds 1-3 up to March 2021 and delivered a sobering scorecard: about 52% of the 774 awarded routes had not commenced operations by the cut-off; projects like water aerodromes sputtered after showpiece launches; and only a small share of routes remained sustainable beyond the three-year concession period. The audit also flagged delays in airport revival, patchy monitoring, and weak demand assessment.

Subsequent government replies to Parliament acknowledged a churn rate on operational routes-nearly 46% discontinued for reasons ranging from low load factors to state-level support gaps and infrastructure constraints-underlining that the weakest link is still sustained demand and dependable inputs (ATC hours, security, night landing, last-mile access).

Was the location choice political, non-commercial-or just premature?

Some white elephants were born of optimism outrunning economics. Airports picked to signal presence, prestige, or balanced geography can still be poor aviation bets if catchment populations can’t fill planes at capped fares, or if better-connected hubs are a two-hour highway away.

The CAG catalogued under-utilized heliports and waterdromes and airfields revived but left without stable airline interest. On ground, state VGF top-ups or fee waivers occasionally arrived late or lapsed after elections, and airlines rationalized fleets to thicker routes. Even where UDAN seeded initial traffic, post-concession survival proved hard.

There are bright spots—Northeast links, hill state access, medevac and seasonal tourism—but the mixed ledger shows infrastructure first, market later is costly when “later” never comes.

What did the Public Accounts Committee and Parliament do with CAG’s findings?

By design, CAG’s audit goes to the Public Accounts Committee (PAC) and the Ministry (MoCA) must file Action Taken Notes (ATNs). In 2025, Parliament’s committees-notably the Department-related Standing Committee on Transport, Tourism and Culture-scrutinized civil aviation, flagged UDAN budget volatility, and pushed for tighter planning, forecasting, and utilization. PAC separately met MoCA, regulators, and airline CEOs amid broader aviation concerns-keeping UDAN’s economics within line of sight even when headlines focused on safety and fares.

Government response has emphasized continuation with course corrections: new UDAN rounds (5.x) with refined guidelines, seaplane norms (2024), and a pledge to extend the framework beyond April 2027, targeting 120 more destinations with a sustainability lens. The Ministry also highlighted ongoing VGF disbursals and infrastructure spends under RCS, while FY 2026 budgeted ₹300 crore for UDAN. The intent is clear: fix the plumbing without shutting off the tap.

How much public money has gone in-and where is it showing up?

Two big streams underpin the outlay. First, VGF to airlines: over ₹4,300 crore disbursed so far to bridge cost-revenue gaps on capped-fare routes. Second, airport revival/development: about ₹4,638 crore under RCS-airside works, terminal sprucing, lights, security, and the paraphernalia that turns an airstrip into an airport. Add to this the AAI’s carrying losses at a long tail of small airports (c. ₹10,853 crore over a decade, per media collation of official replies), and the taxpayer’s commitment is unambiguous. The question is not whether we spent; it’s how to spend smarter so that airports don’t lapse back into silence.

UDAN’s performance in one line: Access improved; durability lagged. The scheme succeeded at kick starting connectivity, but it struggled with making thin routes self-propelling once subsidies taper. That is not unique to India-thin-route aviation worldwide is subsidy-touched-but the CAG makes clear that planning, phasing, and monitoring must be better if we want more airports to hum and fewer to haunt.

From ribbon-cutting to load-factor discipline

The fix is not to mothball UDAN; it is to professionalize route economics and sequence infrastructure to demand. Before committing revival funds, insist on airline-backed demand proofs: firm schedules, realistic fleet availability, and credible interline feed. Where States seek an airport for development show, mandate time-bound state co-funding for last-mile access, security staffing, and marketing; if the support lapses, VGF should auto-decline. For routes that managed initial occupancy but fail post-concession, introduce tapered, performance-linked VGF that rewards punctuality, completion, and load-factor thresholds and withdraws quickly when targets are missed.

Next, MoCA/AAI need to consolidate catchments. Airports within a two-hour surface radius should be curated under a “one-catchment plan” so that schedules complement rather than cannibalize. For ultra-thin sectors, push small-aircraft sub-schemes and helicopter/MEDEVAC models tied to public service outcomes (medical evacuations, school/skill access, district HQ connectivity), not just seat-kilometres. Use the Ministry’s own data and DGCA’s e-systems to publish quarterly route-by-route scorecards-on-time performance, loads, cancellations, subsidy per passenger-so citizens can see which airports earn their keep and which need redesign.

Finally, MoCA has to program the exit. Every revived airport should carry a three-year sustainability test; those that fail must switch use-flying training, disaster relief bases, cargo aggregation, drone corridors, remote-pilot training hubs, or defense/tourism seasonal ops-so sunk capital continues to serve. The point is not to declare defeat; it is to change the mission when commercial aviation isn’t the right answer right now.

(This is an opinion piece, and views expressed are those of the author only)

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