NEW DELHI: The Centre’s second e-bus tender under the ₹10,900 crore PM E-Drive scheme, for 2,900 e-buses in Ahmedabad, Hyderabad, Pune, and Mumbai, and 3,330 buses in Delhi has been deferred by one month.
The tender for 6,230 e-buses opened for manufacturers and operators on 9 January this year, and was scheduled to close on 10 March. But a 6 March notification by Convergence Energy Services Ltd (CESL), the government’s demand aggregation agency, showed the closing date was deferred to 9 April. CESL did not attribute reasons for the deferral.
The PM E-Drive scheme has an allocation of ₹4,391 crore towards subsidies for 14,028 e-buses in nine cities. While 3,330 buses for Delhi under this tender will not be subsidised, the government will cover 20-35% of the cost of procuring the remaining 2,900 e-buses in four cities.
This is the fourth time an e-bus tender under the PM E-Drive scheme was deferred. The previous tender for 10,900 e-buses under the scheme was deferred thrice, with bids closing in November 2025 instead of the planned August date.
An industry executive suggested that tender delays have become routine, which is not ideal given the pace of electrification required. "We are ready to meet the demand and participate but the delay has once again come into the picture," the executive said, speaking on the condition of anonymity.
CESL is responsible for demand aggregation and tendering of 14,028 e-buses under the scheme.
CESL, the ministry of heavy industries, which operates the scheme, and e-bus makers Ashok Leyland, Tata Motors, Eka Mobility, JBM Auto, PMI Electro and Olectra Greentech did not immediately respond to email queries.
Pune-based busmaker Eka Mobility had confirmed to Mint in January that it would participate in this tender. Tata Motors and Ashok Leyland have also said that they will participate in the tender.
City allocation
The second PM E-Drive scheme tender for 6,230 e-buses comprises eight lots spread across the five cities. Delhi, grappling with severe air pollution, will get the largest allocation of 3,330 electric buses through this round of procurement, showed the tender document, reviewed by Mint.
After Delhi, Mumbai will receive 1,500 buses, Pune 1,000, while Hyderabad and Ahmedabad will each get 200 each. These buses, excluding the ones in Delhi, will be subsidized. The demand spans multiple configurations, including 7-metre, 9-metre and 12-metre electric buses, both AC and non-AC.
To participate in all cities, bidders must pay earnest money of ₹134 crore, tender documents showed. High earnest money costs, stringent exit clauses, and infrastructural inadequacy in state government bus stations were the reasons why the earlier tender was delayed, Mint reported earlier in November 2025.
Electric buses typically cost ₹1-1.5 crore. Assuming an average price of ₹1 crore per unit, the tender could likely be worth more than ₹6,000 crore.
Electric bus makers participate in these tenders through fleet operators who are responsible for procuring the electric buses and running them for the respective city/state transport authorities.
This way, automakers avoid holding electric buses on their own balance sheet and can focus on manufacturing operations only, while fleet operators don’t have to invest in making the buses. Buses are instead held on the balance sheets of operators or financiers.
Subsidies under this scheme are transferred to state transport agencies procuring e-buses. These agencies then transfer subsidies to manufacturers and operators.
This comes at a time when electric bus sales are rising. Total registrations of electric buses in the country have increased from 1,988 in 2022 to 4,408 in 2025, with automakers preparing to meet rising demand.
“Subsidies are essential for e‑buses because they lower high upfront costs, while making clean mobility viable for not only Tier-I cities, but for the Tier‑II and Tier-III cities where public bus systems are the backbone of affordable transport. Without support, cities cannot transition at scale,” said Sharif Qamar, associate director of Transport and Urban Governance at The Energy and Resources Institute (Teri).