Gov’t Proposes Subsidies to Reduce Domestic Flight Costs

The Maldivian government has earmarked new transport subsidies in the projected 2027 state budget to reduce the cost of domestic air travel across the archipelago.

According to the state budget proposal submitted by the Ministry of Finance to the People’s Majlis last week, authorities intend to introduce the “North and South Connectivity Project” to bring down passenger fares for flights servicing northern and southern atolls.

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The initiative aims to ease financial burdens on citizens by making domestic travel significantly more affordable and accessible. The government plans to fund this scheme directly through the state’s transport subsidy pool, which allocates MVR 300 million to public transport initiatives.

Budget breakdowns indicate that the ministry has allocated MVR 111 million specifically to subsidise airfares under the North Connectivity Project. The budget documentation, however, does not yet specify the operational framework or subsidy mechanisms for distributing these funds to airlines or passengers.

The government has designated the remaining transport subsidy funds towards expanding the Raajje Transport Link (RTL) ferry and bus network to uncovered atolls, while simultaneously maintaining subsidised fare structures across existing nationwide routes.