MSRTC made losses in 37 of past 45 years; Transport Minister Pratap Sarnaik promises to revive it in 4 years

A white paper issued on Monday provides an account of the MSRTC’s performance over the last 45 years and suggests measures to increase revenue and limit losses.

The white paper states that MSRTC has earned profits in just eight of the past 45 financial years while suffering losses for the remaining 37 years. The MSRTC spent Rs 4,864.34 crore on salaries of employees and Rs 3,656.76 crore on fuel in 2023-24.

As of March 2025, outstanding liabilities exceeded Rs 3,500 crore, comprising Rs 1,262.72-crore provident fund arrears, Rs 1,114.89-crore contribution to the gratuity trust, Rs 217.19 crore in outstanding fuel and supplier invoices, and Rs 821.13 crore in passenger tax arrears.

MSRTC started on June 1, 1948, with one bus on the Pune-Ahmednagar route. The fleet later increased from 35 buses to 10,028 buses in 1981-82 and to 18,275 buses in 2011-12. The fleet declined to 15,764 buses in 2024-2025.

The passenger traffic also increased from 127.52 crore passengers in 1981-82 to 260.04 crore in 2011-12 before it fell down to 213.34 crore in 2024-25. On the other hand, the workforce increased from 79,458 employees in 1981-82 to 112,200 employees in 1991-92, before falling to 86,317 employees in 2024-25.

According to MSRTC officials, most buses have passed their life span, resulting in frequent breakdowns and higher repair costs. “The corporation continues to operate on loss-making routes as part of its social obligations, which adds to its financial burden. One obvious thing: delays in fare revisions have kept revenue below operational costs. Illegal transport operators, especially in rural areas, attract passengers by offering lower fares and have taken away a significant share of the MSRTC’s ridership,” said a senior MSRTC official.

The government, however, has managed to keep the MSRTC operational with a subsidy. It provided Rs 6,353.80 crore as capital grants between 2001 and 2024 and disbursed Rs 4,708.73 crore as revenue grants between 2020 and 2023. In the past four years, it also paid back Rs 9,922.78 crore as subsidies.

Pratap Sarnaik, who is also chairman of the MSRTC, said the recommendations in the white paper would be implemented. “We have put forth the corporation’s current status through the white paper. During my tenure, I promise to revive it by bringing it out of losses in the next four years, if not profitable,” he said.

He also appealed to board members and employees to adhere to the cost benchmarks and achieve the revenue targets.

Proposed measures

For increased revenue, the corporation will induct 5,000 new buses annually and rent Volvo buses. It will provide land for retail fuel stations based on revenue-sharing arrangements with fuel companies. The white paper also stressed that the MSRTC’s assets in the form of land will be developed on build-operate-transfer or public-private partnership terms.

The MSRTC will also upgrade routes to superior classes to charge higher fares and generate more non-operational revenue through retail leases and asset growth. According to Sarnaik, the MSRTC will now have targets fixed for revenue per kilometre and passenger amenities.

“On the spending side, cost-cutting efforts include the induction of 5,000 LNG buses and 1,000 CNG buses into the fleet. The adoption of an ERP (Enterprise Resource Planning) system is also proposed to enhance efficiency in management, along with defining cost-reducing standards,” stated the white paper.

Besides, to improve passenger comfort and safety, the MSRTC plans to induct 5,300 electric buses and introduce the National Common Mobility Card for concessional travel. It will expand digital ticketing through electronic ticket-issuing machines and extend the online reservation system.

The corporation will also install CCTV cameras on buses and in their depots to increase security. It will offer fare concessions to long distance passengers not covered under existing schemes. For its employees, the MSRTC will also roll out employee welfare schemes to address training and healthcare needs.

MSRTC white paper at glance

1981-82

Number of buses 10,028

Number of passengers 127.52 crore

Number of employees 79,458

Number of bus depots 396

2011-12

Number of buses 18,275

Number of passengers 260.04 crore

Number of employees 1,12,200

Number of bus depots 247

2024-25

Number of buses 15,764

Number of passengers 213.34 crore

Number of employees  86,317

Number of bus depots 598