Kolkata: An intercity bus service in Bengal has stalled within two months of its launch, forcing the state-owned transport corporation to cut fares, despite fuel price rise, to boost occupancy. The Banglashree Express, launched by chief minister Mamata Banerjee on 18 July with a fleet of 20 Volvo buses, aims to connect district headquarters with Kolkata.

Bus services, however, didn’t start on some of the routes because there were no takers, said transport department officials, asking not to be named. After the fare cut, the Kolkata-Siliguri service is running at 50% occupancy, they added. The service couldn’t be started at all with the initial fare.

The mandate for the transport corporations is to make the Banglashree bus service viable.

West Bengal’s transport minister Suvendu Adhikari said the bus fares were initially determined based on “prevalent market rates", but they have been reduced to boost occupancy. “We will be sacrificing a little bit of our profits," Adhikari said. In Bengal, Volvo bus fares are capped at 2.20/km.

The decision to cut bus fares was taken by the state-owned transport corporations as revenue from occupancy wasn’t matching up to rising fuel costs—resulting in widening losses, according to the transport department officials cited above.

State-owned bus services are also at a disadvantage to private companies, which enjoy price flexibility. Private operators offer discounts on all routes during lean season and charge full fare when demand peaks, said Rahul Chatterjee, a bus operator. Banglashree’s bus ticket prices were higher than those offered private players at the time of launch.

According to an official at West Bengal Transport Corp. Ltd, 30% occupancy in a 50-seater Volvo bus is enough to recover the operating costs on a route. The recent fare cut has bought in more passengers, but one of the 19 routes is yet to be operational, he said.