India has approved an investment of 576.13 billion rupees ($7 billion) for green public transportation as it seeks to curb emissions from vehicles and meet swelling demand in its cities.
(Bloomberg) — India has approved an investment of 576.13 billion rupees ($7 billion) for green public transportation as it seeks to curb emissions from vehicles and meet swelling demand in its cities.
The investment will be made to deploy 10,000 electric buses across cities, Information and Broadcasting Minister Anurag Thakur said Wednesday. “There is a lack of public transport, especially buses, in cities,” he said, after a meeting of the federal cabinet. “This move will give a boost to electric mobility.”
The federal government will contribute 200 billion rupees to the plan that will involve participation from private firms, Thakur told reporters. Cities with a population between 300,000 and 4 million will compete for the aid, he said.
Shares of electric bus makers Olectra Greentech and JBM Auto rallied on the announcement.
The decision follows a meeting between US climate envoy John Kerry and India’s heavy industries minister Mahendra Nath Pandey last month, where the two leaders discussed U.S. financial support to speed up deployment of 10,000 electric buses in India.
Electric vehicle sales in India more than doubled in 2022 to 1.4 million, driven by subsidies for buyers and rising fuel costs, according to BloombergNEF. Two and three-wheeler vehicles comprised most of the sales, with passenger cars accounting for a tiny fraction. Annual sales are expected to reach 10 million units by the end of the decade, Prime Minister Narendra Modi said at the G20 energy ministers’ meet last month.
Thakur said that though the electric buses will mostly be profitable, the government will provide provide subsidies to make operations viable.
A report commissioned by the federal oil ministry earlier this year pointed that cities should refrain from adding diesel buses to help decarbonize urban mobility. The study pointed out that India, which had 1.9 million buses as in 2019, needs to add 3 million more to meet public transport demand.
–With assistance from Bibhudatta Pradhan.
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