The Union Budget presented by finance minister Nirmala Sitharaman has proposed creating 100 new airports by 2024 to help growing air traffic under Centre’s Udan scheme.
The budgetary allocation for the civil aviation sector reduced by around 16%from Rs 4500 crore (budget estimate) in 2019-20 to Rs 3797.71 (BE) in 2020-21. Revised estimates for 2019-20 were Rs 3700 crore.
“Air traffic has been growing rapidly in the country as compared to global average. One hundred more airports will be developed by 2024 to support Udan scheme. .. .” the finance minister said. The government’s Udan scheme is aimed at making air travel affordable, improving regional connectivity and developing regional airports.
Sitharaman also announced a Krishi Udan Yojana to be launched by the ministry of civil aviation on international and national routes.
“The Krishi Udaan Yojna, to be launched on international and national routes, will immensely help in bringing our North-East & tribal districts to the forefront. This will help investors realise the unearthed potential of these regions and attract investment from all quarters. This budget also gives wings to aspirations of the common citizens by allocating resources for development of 100 more airports under UDAN scheme by 2024,” Union civil aviation minister Hardeep Puri said.
“The budget announcement for developing 100 new airports by 2024 is a welcome initiative. It will definitely boost air traffic and tourism in hitherto lesser connected regions in the country. However, the proposed development of new airports must be complemented by a holistic aircraft leasing and financing policy as announced in the last budget. In addition to this, a hike in FDI in aviation is highly warranted. We need more players in the sky, more aircraft to fly more passengers,” said Ankur Bhatia, Managing Director, Amadeus, Indian subcontinent.
{{/usCountry}}“The budget announcement for developing 100 new airports by 2024 is a welcome initiative. It will definitely boost air traffic and tourism in hitherto lesser connected regions in the country. However, the proposed development of new airports must be complemented by a holistic aircraft leasing and financing policy as announced in the last budget. In addition to this, a hike in FDI in aviation is highly warranted. We need more players in the sky, more aircraft to fly more passengers,” said Ankur Bhatia, Managing Director, Amadeus, Indian subcontinent.
{{/usCountry}}The aviation sector will also benefit from the move to incentivise Sovereign Wealth Funds to invest in infrastructure, some experts said. According to Ajay Singh, Chairman and Managing Director, SpiceJet, concessions to sovereign and pension funds to get long term funds for infrastructure is a positive step.
“The minister has done an extremely good job considering the difficult situation she was in... Importantly, this is the first budget where the Centre has tried to bridge the trust deficit with Corporate India and the fact that the FM has said that she will not tolerate tax terrorism and there will be a tax charter are positive signs,” he said.