India’s Electric Bus Market: Private Sector’s Role and Challenges

Private Sector’s Role:

• PM EDRIVE scheme allocates funding for electric vehicles across sectors.

• Excludes private bus operators from subsidy framework, raising concerns about scalability beyond State-run buses.

Public Sector’s Role:

• Despite public sector support, private buses represent 93% of buses in India.

• Limited financing availability and high perceived risk-return profiles pose challenges.

Hurdles for Private Electric Bus Adoption:

• Electric inter-city buses can be more profitable than diesel buses.

• High interest and loan instalment costs make electric buses less financially viable.

• Private intercity bus operators could benefit from electric buses.

• Shared public charging infrastructure needed to accelerate private-sector electric bus adoption.

BaaS Business Model:

• Battery-as-a-Service (BaaS) could reduce upfront costs of electric buses.

• This model, along with battery swapping, could accelerate private electric bus adoption.