Abstract
The expansion of the Indian economy is expected to extend to remote regions, and while market-driven processes are ideal for regional air connectivity, there is recognition of the valuable role of public policy in this endeavor. The UDAN Scheme follows a market-oriented approach where operators assess demand, propose routes, and navigate variables like traffic rights, slot allocation, regulatory restrictions, and infrastructure limitations. Global airline industry deregulation has introduced healthy competition, enhancing efficiency and service quality, leading to increased passenger traffic. Studies have highlighted the constructive impact of improved air connectivity on the economic development of regions. Efficient airports are vital economic catalysts, but research suggests that some regional airports operate inefficiently, missing opportunities for profitability. Government subsidies and policies for enhancing regional and remote air connectivity are common practices worldwide, with schemes like EAS in the United State and PSO in Europe bridging the accessibility gap. Research is crucial to understand policy effects on air connectivity and identify factors that improve outcomes. Route dispersal guidelines, such as those in India, can create financial redistribution between route categories, affecting airlines' profitability and serving state capitals over remote regions. Policymakers must find effective ways to enhance air transport to underserved areas where market dynamics might not naturally establish viable transportation links. In summary, this study emphasizes the importance of government-supported policies like UDAN and the role of market-oriented approaches in promoting regional air connectivity. It underlines the need for research to assess policy impacts and identifies the challenges and opportunities in enhancing air connectivity to remote and underserved regions.
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