INDIA NEEDS MORE THAN 220,000 PUBLIC BUSES IN NEXT 3 YEARS - SHRI ABHAY DAMLE, JOINT SECRETARY, MoRTH

Mr. Abhay Damle, Joint Secretary, Ministry of Road Transport and Highway (MoRTH) delivered an inspiring speech at National Seminar on "Sustainability for Public Transport through Innovative Interventions" organized by ASRTU (Association of State Road Transport Undertaking) in New Delhi on 15 March 2017. Some of the key points shared by Mr. Damle are as below:

1) GST is a very exciting change. This will provide way for seamless and barrier free transport across boundaries and all compliances will be taken care of by a strong IT backend. One challenge that private vehicles faced in the past is the delay at tolls  gates, However the delay at toll gates has reduced lately  due to introduction of FastCash and e-tolling that has seen about 30% adoption till date. In future, the government will get more money through e-tolling .as the adoption rates go higher

2) Passenger Transport can be classified into two categories - Public Transport such as any person using non personalized vehicles or children using school buses   and Shared Mobility such as taxis.. People now  prefer public transport and new mobility solutions over personal vehicles. The ministry is looking forward to promote all modes of mobility solutions that are non-personalized transport which can help reduce  private vehicles ownership.

3) A study was conducted in Lisbon, Portugal to gauge the potential of replacing private vehicles with on-demand taxis / shared mobility with certain quality standards (mainly service times). It was found that the city just  needs 9% of the total fleet or cars. Similarly Delhi can also think of a situation, where 1.6 million cars can replaced with just 150,000 taxis.  While the idea is far-fetched it’s not impossible.

4) Bus network and taxis can work together and in bigger cities, Metro can work with taxis. In last 3-4 years, taxi industry has changed  and  Taxis are now part of public transport. The other public transport mode operators can learn an important lesson from the success of Taxis that Cost is not that important. People are willing to use non-personalized transport if they can get efficiency, availability, adequacy, safety and comfort. These are exactly the things, which are being offered by alternative mobility solutions. Public transport needs to look beyond its traditional outlook of cheapest possible solutions. The tariffs of the services can be charged on the basis of their quality. The customers are ready to pay the additional fare  if they get some value for it. If the outlook of Public Transport organizations doesn’t change soon they will continue to suffer losses by providing low cost solutions.

5) All STUs suffer losses due to the huge manpower cost. Diesel and Manpower constitute more than 100% of total cost in case of urban city buses and 89-90% of total cost in case of inter-city buses. If such a large portion of expenditure is consumed by manpower and diesel, then there is hardly any scope for replacement of the old fleet with a  new one, and any investments on other new initiatives. STUs are stuck in a vicious cycle - operating older buses, offering cheaper buses, and cheaper services to public and incurring losses. In last 20 years, the growth of STUs have been very slow, the growth has not been able to keep the pace with population growth rate. STUs are carrying almost same number of people in 2017, which they were carrying in 2000.

6) The availability of public transport is very low in India compared to other developing and developed countries. India just has 1.2 buses for 1000 inhabitants, which includes all the buses put together including private buses. There are 1.4 million buses in India, including large and small sized buses. Of the total, STUs just have  140,000 buses indicating a gross shortage of buses 

7) There is a need for innovation for sustainable operations. Sustainability consist of two issues –

a) STUs are adopting various initiatives and practices for environment and employees. It is important to see if all these initiatives are one-time affairs or scalable. All practices have to be sustainable to make transport sustainable. STUs need to adopt sustainable practices that can bring long terms changes, without which the chances of a sustainable transport are sparse. Sustainable practices hence need to standardized and even institutionalized

b) STUs have to improve the strength of their balance sheets. Profit and loss accounts should show higher incomes and lesser expenses. All STUs put together reported a loss of INR 80-90 billion per year. All public transport organization around the world are not making profit and report loss, as they need to perform social obligation by giving concessions and services at all locations and to all sections of society. Currently, STUs carry around 70 million trips a day translating to around 27 million passengers. There is need to increase the usage and adoption of public transport and hence STUs should target  increasing the trips to 140 to 200 million per day in next 3 years. Public transport organizations will need to think of solutions to strengthen themselves and their balance sheets. 

8) Route rationalization and occupancy improvement has a little scope in India. Most of the STUs in India have good occupancy ratio of 60-70%, whereas the occupancy is just 30-40% in other cities around the world. India has overloading issues in the peak hours and there is a limited scope of improving occupancy and route rationalization. There is a clear demand and l supply gap as STUs are making 70 million trips with 140,000 buses. If STUs want to reach 200 million trips a day, India will need to have around 210,000 or 220,000 more buses in next 3 years (with multiple factor of 2.5). To procure those many additional 220,000 buses, India will need around INR 660 billion (US$10.2 billion) considering average cost of the bus is  INR 3 million. It is not possible for the government or STUs to arrange the fund in their current condition.

9) Further STUs are incurring higher cost to operate the buses because of high manpower and issues related to maintenance. STUs should look for alternatives and can operate 40% of the buses themselves and 60% of the buses can be operated by private players under lease model. In such case, the staff will be utilized well .  making the bus operation viable. The government, including MoRTH, can also look to provide VGF (Viability Gap Funding) if the gap is just INR 5-10 per km to the private players however the VGF cannot stretch to INR40-50 per km. STUs need to think of innovative models as the wages are increasing. 

10) There are various technological solutions that need to be in place to improve the safety, efficiency, comfort and quality of public transport.