Govt to stagger ₹57,613 cr e-bus scheme investment over 7 years

New Delhi: The central government will not make an upfront investment in the ₹57,613 crore PM-eBus Sewa scheme, but stagger it over a period of seven years and release funds based on the distance travelled by these 10,000 e-buses on a per kilometre basis, two people with direct knowledge of the matter told Mint.

“After the buses are tendered, the central government will pay on a per kilometre basis, and will not make an upfront investment for these schemes,” said the first person mentioned above, a senior government official, who spoke under the condition of anonymity. “The private sector will operate these buses. Fares collected will be topped by any further requirements of the state government, by the central government,” the person added.

The Cabinet has approved last month the ₹57,613 crore PM-eBus Sewa scheme in public-private partnership (PPP) mode, of which the government will provide ₹20,000 crore.

Under the 10-year scheme to augment city bus services, 10,000 electric buses will be deployed in 169 cities, prioritizing those lacking organized bus services. The central government expects the scheme to generate 45,000-55,000 direct jobs. The scheme aims to push green initiatives like bus priority, infrastructure, multimodal interchange facilities, National Common Mobility Card (NCMC)-based automated fare collection systems, charging infrastructure, among the others, with the help of private sector participation.

Under the scheme, while states are responsible for running the bus services and making payments to the bus operators, the centre will support these bus operations by providing subsidies.

The outlay for the PM-eBus Sewa scheme will be accommodated within the budgeted estimates for the fiscal year 2024, the person said.

“However, these outlays will have no impact on this year’s fiscal deficit numbers as this is a long term scheme requiring investments from the central government over a period of time,” the person said. The allocations to states, under the scheme, will be decided during the revised estimates in October-November, the person added.

A finance ministry spokesperson didn’t respond to queries.

The PM e-Bus Sewa scheme will cover cities with a population of 300,000 to four million (according to the Census 2011). There are 169 cities eligible to apply for electric buses under this scheme.

Following the cabinet decision to approve the PM e-Bus Sewa scheme last month, Manoj Joshi, secretary, ministry of housing and urban affairs (MoUHA) had said that the final number of cities to be covered under the scheme will depend on the number of cities that apply for it.

He had added that the cities that have a population of upwards of four million —nine biggest cities of India—will be excluded from the scheme as these cities are already covered under the Faster Adoption and Manufacturing of Electric Vehicles (FAME) scheme run by the ministry of heavy industries.