The Indian government is poised to introduce key relaxations in aviation policy, enabling regional airlines to operate on high-demand metro and busy routes currently dominated by national and international carriers like IndiGo and Air India. This move aims to foster competition, alleviate capacity strains on congested hubs such as Delhi-Mumbai and Mumbai-Bengaluru, and bolster smaller operators under the expanded UDAN (Ude Desh ka Aam Naagrik) scheme.

Currently, regional carriers face strict route dispersal guidelines (RDGs) that bar them from metro-metro flights, confining operations to Tier-2/3 cities and underserved airports. The proposed easing—potentially including relaxed fleet norms and direct incentives without bidding—would allow single-aircraft or small-fleet operators to bid for prime slots, backed by viability gap funding and lower ATF levies at regional airstrips. This builds on UDAN’s extension beyond 2027, targeting 120 new destinations amid recent disruptions like IndiGo’s 2,000+ cancellations.