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The Union Cabinet on Wednesday approved the modified UDAN 2.0 scheme with an outlay of Rs 28,840 crore, aimed at strengthening regional air connectivity and expanding aviation infrastructure across the country.Under the revamped scheme, 100 new airports will be developed in challenge mode, with an average cost of Rs 100 crore per airport and budgetary support of Rs 12,159 crore.The plan also includes the development of 200 modern helipads with a budgetary allocation of Rs 3,661 crore, to improve connectivity in hilly, North-Eastern, island and aspirational regions."This is a historic moment for our country. The massive new Rs 28,840 crore UDAN scheme will help connect India like never before. The enhanced Viability Gap Funding of Rs 10,043 crore is a significant step that will help make regional and emerging segments like seaplane operations more sustainable over the long term. It will give operators, investors and lessors the confidence to invest and build connectivity to areas that have so far remained out of reach," Avani Singh, Founder and CEO SkyHop Aviation, told ET Online.To support airline operations, the Centre will provide 80–90 per cent viability gap funding (VGF) with tapered support over five years, with a budgetary allocation of Rs 10,043 crore.The scheme also provides for operations and maintenance (O&M) support, with the Cabinet approving three-year assistance for RCS airports. This includes a ceiling of Rs 3 crore per airport annually and Rs 90 lakh per helipad per year, with a total budgetary support of Rs 2,577 crore."The UDAN scheme will run for 10 years, and existing airstrips will be converted into airports to expand regional connectivity," said Union Cabinet Minister Ashwini Vaishnaw In addition, the scheme includes the acquisition of Made-in-India aircraft with a budgetary support of Rs 400 crore, in line with the government’s push to boost domestic manufacturing.In line with the Atmanirbhar Bharat push, the government has proposed the acquisition of domestically manufactured aircraft, including HAL Dhruv helicopters for Pawan Hans and HAL Dornier aircraft for Alliance Air, to address shortages in smaller aircraft suited for regional operations.The government said the scheme is expected to boost economic growth, trade and tourism in Tier-2 and Tier-3 cities, while improving healthcare access and emergency response in remote areas. It also aims to strengthen India’s aviation ecosystem and contribute to the broader Viksit Bharat 2047 vision.Launched in 2016, the original UDAN scheme has operationalised 663 routes across 95 airports, heliports and water aerodromes as of February 2026. Over 3.41 lakh flights have been operated under the scheme, carrying more than 1.62 crore passengers.