Making Bengaluru's public transport safer, more frequent, and more financially stable
WRI India worked closely with Bengaluru’s public bus operator in 2017 to improve services for commuters. The Bengaluru Metropolitan Transport Corporation (BMTC) is the sole operator of public buses in the tech-hub, catering to approximately 50 lakh passenger-trips daily. The fast-growing metropolis does not yet have a significant rail-based mass transit system, which makes the BMTC’s services all the more important.
Expanding Bengaluru’s bus fleet
Bengaluru’s public bus operator has struggled to increase its fleet to match growing commuter demand. By international standards, a city of Bengaluru’s population would require at least 12,000 buses. However, as of March 2017, BMTC operated 6,219 buses, up just 108 buses since 2011. Across the same period, the number of registered vehicles in the city grew from 42 lakh to 70 lakh, an increase of over 66%. This exponential growth in private vehicles has resulted in chronic traffic congestion across the city, and without a substantial increase in the number of public buses – to provide reliable, comfortable and affordable public transport – this growth in vehicles is likely to increase, choking many of the city’s roads.
In order to contain the alarming increase in private vehicles, WRI India assisted BMTC obtain funding to procure more buses. In November 2015, as part of an advisory group to Bengaluru’s restructuring committee, WRI India presented an analysis of BMTC’s needs at a meeting of Bengaluru’s ministers and senior bureaucrats, which helped create awareness in political circles about the need for funding bus transport. WRI India also provided technical assistance to BMTC in drafting proposals for augmenting the bus fleet, which were submitted to the state government. This involved evaluating the best business and operating models for these buses, and devising a data-driven narrative to show that the operator could not meet the capital expenses by itself.
The proposal was submitted to Karnataka state in early 2017. The government has since sanctioned an estimated INR 525 crore for the procurement of 1,500 buses. A further 1,500 buses will be procured under a public-private partnership. This increase in fleet strength is unprecedented in recent decades and will improve rider experience by enhancing frequency and seat availability – providing greater incentives for commuters to use public transport instead of their own vehicles.
A reprieve from public transport taxation
A paradox of the Indian taxation system is that it taxes public bus transport, effectively providing a perverse ‘subsidy’ towards private vehicle ownership. Although public bus operators are expected to function on ‘social’ principles, many states view them as an easy source of fiscal revenue, taxing them almost as commercial entities. The resulting outflow has left many operators with little or no funds to invest in improving service quality.
In 2016, WRI India analysed the taxation of public bus operators across India and the extent to which the practice affected the financial stability of operators. The study included a deep-dive analysis of Karnataka and the impact on BMTC. It found that BMTC’s overall tax liability in the 2014-15 on direct and fuel taxes was INR 309 crore. The same year, BMTC recorded a loss of approximately INR 65 crore after clearing its tax liabilities.
BMTC requested WRI India to draft a proposal to the state government seeking exemption from direct taxes. The proposal focused on BMTC’s finances and showed that external factors beyond the operator’s control had resulted in almost consistent losses from 2011. The proposal noted that BMTC was paying the highest direct tax rate of any city-level operator in India, and tax demands had grown at a much higher rate than in neighbouring states.
In response to the proposal, the government of Karnataka exempted BMTC from paying Motor Vehicle Tax for 2016-17. This policy shift has made Karnataka one of the more liberal states in public bus taxation. It has also made over INR 120 crore available to the operator to reinvest in systemic improvements to enhance service quality.
Making buses safer for women
Bengaluru’s public bus operator has received INR 56 crores under the Government of India’s Nirbhaya Fund to make public transport safer for women.
The proposal, developed by WRI India for BMTC, put forth eight measures to improve safety. They include: training more women bus drivers; installing CCTV cameras on all buses and 35 stations; a centralized control room; women-only lounges; gender-sensitization training of staff; a mobile application for real time tracking of buses; increased patrolling; and a public awareness campaign.
The proposal was awarded under the Nirbhaya Fund, an INR 1,000 crore fund set up in 2013 to support initiatives that protect the dignity and safety of women. WRI India will work closely with the Bruhat Bengaluru Mahanagara Palike (BBMP), the traffic police, the Bangalore Political Action Committee (B.PAC) and Safetipin to implement these solutions.