Adhere to revised timetable: Transport Minister Sarnaik tells consortium supplying e-buses to MSRTC

In July 2023, the Maharashtra State Road Transport Corporation (MSRTC) awarded the wet lease contract for 5,150 electric buses to Olectra and Evey Trans (under wet leasing, the lessor provides both the vehicle and the crew). The project was seen as a key step in the state transport body’s fleet modernisation drive. However, persistent delays in delivery led to MSRTC issuing seven showcause notices and imposing penalties worth around Rs 4 crore.

In a media briefing after the meeting, Sarnaik confirmed that of the 5,150 buses, just 220 have been delivered so far. These include both 12-metre and 9-metre variants. Despite the poor supply record with MSRTC, the minister did not reiterate his previous announcement regarding the termination of the contract. Instead, he floated the possibility of seeking viability gap funding (VGF) from the state government to offset the high per-kilometre losses being incurred by MSRTC while running these electric buses.

He further said that MSRTC is facing a loss of Rs 12 per kilometre for the 12-metre buses and Rs 16 per kilometre for the 9-metre variants, which could add up to Rs 3,191 crore over the next few years.

“We had earlier decided to terminate the contract since the consortium failed to supply the e-buses on time. However, the company officials proposed a new timetable under which they will supply 620 buses in 2025, 2,100 buses in 2026 and the remaining buses in 2027,” said Sarnaik.

During the meeting, officials of the consortium told him that the bills of the 220 buses, which have been already supplied, is around Rs 100 crore, of which Rs 60 crore has been cleared while Rs 40 crore is yet to be paid.

“They said that while the corporation is pointing out their delays, but there is a also bill pending,” Sarnaik said.

“The contract can be worked out only if  the state government agrees to give the corporation this amount so that we can pay the same to the company and they can send us more buses. Then only will the project become viable,” said Sarnaik, adding that he would soon hold a meeting with Chief Minister Devendra Fadnavis and Deputy Chief Ministers Eknath Shinde and Ajit Pawar to take a final decision.

The change in stance has surprised observers, especially given the consortium’s poor track record not only with MSRTC but also with Mumbai’s BEST undertaking, where similar delays have been reported.

With a fresh deadline publicly disclosed, Sarnaik’s softened approach signals that the government may be willing to work around the delays – provided financial backing is secured and deliveries are ramped up.