E-bus demand surpasses target, states may have to settle for less

After a tepid year, the government's scheme for subsidized electric buses has generated such an overwhelming response that states may have to settle for fewer units than they sought, according to two people aware of the development.

- Manas Pimpalkhare

The Centre has already received requests for over 15,000 e-buses from various states under the Prime Minister's E-drive scheme against the targeted 14,028 units, the people quoted earlier said on the condition of anonymity.

Maharashtra, West Bengal, and Tamil Nadu are yet to submit their demand for e-buses in Mumbai, Pune, Kolkata, and Chennai, said one of the people quoted earlier.

"The government is still awaiting clarity on demands from some cities, which will make the total demand even higher. The number of buses to be tendered in each city may have to be lowered," said this person.

The number of electric buses sold in the country fell 5.7% on-year to 3,314 in FY25, the Vahan portal data showed.

Mint reported on 16 March 2025 that the adoption of electric buses in FY25 at 4.72% was the lowest since 9.34% in FY22. But the response from states this year suggests a pick-up in demand.

The overwhelming response to the scheme "demonstrates that public transport stakeholders are willing to transition to zero-emission fleets if adequate financial support systems are in place", said Dhiraj Agarwal, chief business officer at Mufin Green Finance, which lends to businesses and individuals for electric vehicle purchases.

The government has allocated about 40% of its ₹10,900-crore PM E-drive outlay to subsidize e-buses.