OWNERSHIP POLICY OPTIONS AND REGULATORY MECHANISMS FOR URBAN BUS SYSTEMS IN INDIA

This paper discusses various policy options and regulatory approaches for urban bus systems in India. It considers: (1) publicly owned systems; (2) mixed public-private ownership; (3) privately owned bus services. Publicly owned bus systems seem to have substantially higher total costs, so that there is considerable scope for private participation. The authors propose nine viable alternative ways of sharing the basic roles of planning, coordinating and operating a public transport system between public and/or private sectors, and discuss the merits and disadvantages of these options. They then assess the present regulatory framework and possible future regulatory mechanisms in India. They reach the following conclusions: (1) urban bus transport services should not be sponsored and provided by a single government agency; (2) private bus operations are significantly less costly than public in terms of cost per km, cost per day and cost per bus; (3) centrally run regional bus systems may be less efficient and may suffer from diseconomies of scale; (4) Indian urban bus policy should consider quality and continuity of service, efficiency of operation, etc when choosing between competing public and private service providers; (5) contract arrangements should incorporate clear performance criteria, incentives and penalties to ensure acceptable levels and quality of service; (6) tendering proposals should contain sufficient information; and (7) with a suitable mix of viable public and private services, the bus system as a whole can respond better to market and population changes. (TRRL)