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India’s federal government has greenlit a 580 billion rupee ($7 billion) initiative to introduce 10,000 electric buses in 169 cities over the next ten years. The scheme also encompasses the development of charging infrastructures and related facilities.
Of the project’s total budget, the federal government will allocate 200 billion rupees, utilising a public-private partnership model. The source of the remainder of the funding, whether it will come from state governments or private entities, remains uncertain.
Following the announcement, stocks of companies anticipated to gain from the scheme saw an uptick. Olectra Greentech and JBM Auto, renowned electric bus manufacturers, witnessed an 8.8% and 10.1% surge in their shares respectively.
Tata Motors reported a 1.9% increase, while shares of Ashok Leyland, which owns an electric bus manufacturing subsidiary, ascended by 0.9%.
This move by the government accentuates its commitment to lower greenhouse gas emissions and minimise fuel imports. As part of the incentive, companies are encouraged to locally produce vehicles and their components.
With a vision of deploying 50,000 electric buses throughout the country, which is estimated to cost around $12 billion, the government is consolidating demands from state governments and floating tenders for corporate participation.
Financial backing from the central government for eco-friendly public transportation comes amidst concerns from bus manufacturers regarding payment delays from state transportation bodies for traditional buses. Analysts opine that the dedicated funding will embolden bus manufacturers to actively participate in government tenders without apprehension.
In addition to this, the cabinet has sanctioned railway tracking projects worth 325 billion rupees, aiming to enhance connectivity across nine states.
