Controversial Air Odisha gets to fly on 50 routes in UDAN scheme

Air Odisha Aviation—which has been hit by controversies—won the largest chunk of 50 out of the total 128 regional routes to fly under the first phase of the Union government’s UDAN Regional Connectivity Scheme that aims to connect the hinterlands at subsidised rates. Captain GR Gopinath’s Air Deccan, Trujet (brand name of Hyderabad-based Turbo Megha), SpiceJet and Air India subsidiary Alliance Air were the other airline companies that won bids on Thursday.

Interestingly, Alliance Air and SpiceJet could get only 15 and 11 routes respectively. Air Deccan, which pioneered low-fare air tickets in India—starting at ₹1—and perhaps the concept that crashed the aviation industry, won 34 routes. Trujet, which according to its website, has a fleet of just three ATR-72 500 aircrafts (72 seats), won 18 routes. All the successful bidders would have exclusive rights to operate the respective routes for a period of three years.

Announcing the award of bids for the regional connectivity flights, after the first round of bidding, Civil Aviation Minister P Ashok Gajapathi Raju said, “Within four to six months, all these new regional flights will become operational. UDAN will have a positive effect on the economy, in terms of employment and investment.” The first flight is expected to take off next month.

The UDAN (Ude Desh Ka Aam Naagrik) scheme envisages providing connectivity to un-served and under-served airports of the country through revival of existing air-strips and airports. Thirteen less-known airports would come onto the map for the first time, while 43 other airports will be part of this project.

While total seats offered on these routes will be around 13 lakh, 50% of the seats on the UDAN flights would have a cap of ₹2,500, this subsidy is sought to be recovered through a nominal charge from passengers taking other regular flights. Jayant Sinha, the Minister of State for Civil Aviation, said that ₹205 crore would be needed for the subsidy to implement the scheme

The new UDAN routes awarded on Friday show how Air Odisha dominated the first round of bidding:

What seems surprising though is that Air Odisha Aviation continues to get better deals while being mired in controversies. Its Chairman and Managing Director Santosh Pani was arrested on charges of cheating in June last year. Pani was arrested on a complaint filed by Sandeep Ray, the son of former Union coal minister and BJP legislator Dilip Ray, who alleged that Air Odisha Aviation had cheated him of ₹40 lakh.

There were more charges: Mitesh Khimji, director of Khimji Jewellers alleged before the Bhubaneswar police that the airline had cheated him of ₹1.5 crore. Steven Nixon of Dublin-based ITCL Ireland, had lodged a complaint with the state government against the air service operator alleging monetary fraud to the tune of ₹2.5 crore. Also, Air Odisha’s intra-state air services were grounded in June 2016 as the state government had terminated its agreement.

Still, none of that seems to have hindered Air Odisha Aviation’s flourishing growth. Is there something more than what meets the eye?