Overview
India’s regional aviation market is at an inflection point. With over 70 airports operationalised under the UDAN scheme since 2016 and passenger traffic at tier-2 and tier-3 cities growing at 18% year-on-year, the infrastructure implications are significant – and largely underestimated.
This piece examines where that growth is headed, what it demands from developers and planners, and where the gaps remain.
The UDAN Effect: A Decade In
The Regional Connectivity Scheme (RCS-UDAN) was designed to make air travel affordable and to activate underserved routes. The outcomes have been mixed but directionally positive:
- 74 airports and aerodromes activated under UDAN as of 2025
- 550+ routes awarded across four rounds
- Passenger volumes on UDAN routes crossed 12 million in FY2024-25
The scheme proved demand exists. The challenge now is whether the infrastructure can sustain it.
Where Capacity Is Breaking Down
Most UDAN airports were activated with minimal terminal investment, repurposed military strips, legacy AAI facilities, or bare-bones greenfield terminals. As demand has grown, several structural issues have emerged:
Terminal capacity – Passenger terminals at most tier-2 airports were designed for 200–300 peak-hour passengers. Several now handle double that.
Airside constraints – Single runway, no parallel taxiway, and limited apron stands create operational bottlenecks during peak windows.
Ground support infrastructure – Fuel availability, GSE, and ARFF capability remain inconsistent across the network.
Commercial viability – Many routes remain subsidy-dependent. Without sustained load factors, infrastructure investment cases are hard to close.
What the Next Decade Demands
The Ministry of Civil Aviation’s Vision 2040 targets 220 operational airports by the end of the decade – up from approximately 140 today. Achieving that requires:
- Greenfield development at 30–40 new locations, primarily in the northeast, central India, and underserved coastal regions
- Expansion and modernisation of existing UDAN airports to handle ATR 72 and Q400 operations at scale
- PPP structuring to bring private capital into airport development, operations, and commercial real estate
- MRO co-location at select regional hubs to reduce aircraft downtime and support base maintenance
Implications for Infrastructure Developers
For developers, consultants, and operators watching this space, three themes stand out:
Design for growth, not just opening day. Most regional airport briefs are scoped for current traffic. The better approach is phased design – terminal shells that can expand, apron layouts that accommodate future stands, and utility infrastructure sized for 15-year demand.
Regulatory navigation is non-negotiable. DGCA, AAI, BCAS, and state aviation departments all have overlapping jurisdictions. Projects without experienced regulatory interfaces consistently face delays of 12–18 months.
Integrated planning creates value. The most successful regional airport projects combine airside planning, landside access, cargo provision, and commercial development into a single master plan – not separate workstreams.