The Indian Ministry of Civil Aviation has called for counterbids to be submitted for the forty-five initial proposals sent in by eleven bidders during the first round of considerations for the Regional Connectivity Scheme (RCS).
A statement said the proposals cover sixty-five designated airports, of which fifty-two are unserved while thirteen are underserved facilities. Counterproposals should be submitted by February 1, 2017. The routes or networks will be awarded to the bidders who quote the lowest Viability Gap Funding (VGF) requirement for their requested routes.
Administered by the Airports Authority of India (AAI), the RCS programme aims to increase the penetration of air travel among India's working and middle classes by subsidizing flights to the country's 400+ underserved Tier II and III cities. Financing for the flights will come through a system of financial incentives including Central and State government concessions and VGF. The latter will be raised through the taxation of scheduled commercial flights between India's Tier I city airfields which include Delhi International, Mumbai International, Chennai, Hyderabad International, Bengaluru International, and Kolkata.
As it currently stands, initial RCS projections show the fare for a one-hour journey of approximately 500 kilometres on a fixed-wing aircraft, or a 30-minute journey on a helicopter, will be capped at INR2,500 (USD36.45), with proportionate pricing for routes of different lengths/duration.
