Development of domestic aviation market

♤ To stimulate further growth and development of the sector, amount collected as Regional Connectivity Fund (RCF) will be used to provide financial support to

airlines in the form of Viability Gap Funding (VGF) for operations under the Scheme. The RCF levy per departure will be applied to certain domestic flights.

The partner State Governments (other than North Eastern States and Union Territories where contribution will be 10 %) would contribute a 20% share to this fund which will be used for the development of aviation market

♤ Creation of regional air connectivity / services that would have spin-off benefits within the sector in terms of passengers taking other flights (not under RCS) and using airports / airport services that are not at concessional rates under RCS. The amount collected under the levy will be ploughed back into the sector.

♤ Amount expected to be collected under this levy in context of other businesses which create connectivity and benefit from the network effect, for example, telecom and railways

♤ Step to use civil aviation to boost tourism, jobs and balanced regional growth across the country.

♤ Exclusive rights will be given to the regional airlines on a route for the 1st three years to ensure commercial viability of these regional routes and aiding the growth of aviation market.