Electric Buses & Urban Bus Transport

Central funding for electric buses began at scale with FAME India Phase II, which ran from 1 April 2019 to 31 March 2024 with an outlay of ₹11,500 crore. In August 2019 it sanctioned 5,595 e-buses to 64 cities and transport bodies, and the total sanctioned later reached 6,862. In August 2023 the Cabinet approved PM-eBus Sewa, giving priority to cities with no organised bus service. In September 2024 the Cabinet added PM E-DRIVE and a payment security scheme for bus operators.

By March 2026 all 10,000 buses under PM-eBus Sewa had been sanctioned, across 116 cities in 20 States and 6 UTs. The scheme covers cities of 3 to 40 lakh people, as well as state capitals and the capitals of north-eastern and hill states. According to the ministry, about 30% of participating cities will get an organised public transport system and about 80% will move to e-mobility for the first time. Sanctions for power and civil depot infrastructure reached ₹1,254.38 crore by December 2025, of which ₹483.70 crore had been spent.

Most e-buses are inducted on a Gross Cost Contract: the manufacturer or operator buys and runs the buses, and the public transport authority pays a monthly fee instead of the upfront price. Under PM-eBus Sewa the Centre pays operating support per km — ₹24, ₹22 and ₹20 for 12 m, 9 m and 7 m buses — for 10 years or until March 2037, and fully funds behind-the-meter power infrastructure. If a transport authority defaults, the Payment Security Mechanism fund, run by CESL, pays the operator, and the State must repay within 90 days with a late payment surcharge. Deployment usually takes about two years from signing the concession agreement.

Most newly sanctioned buses were still to reach the roads in 2026. As on 28 February 2026, tenders had been concluded for 6,228 PM-eBus Sewa buses and letters of award issued for 4,720. Under PM E-DRIVE, the Phase-I tender for 10,900 buses was concluded and a Phase-II tender for 2,900 was floated, with no buses deployed as on 12 March 2026. The scheme was extended to 31 March 2028, and by 10 July 2026 the payment security scheme covered 27,555 of its targeted 38,000 e-buses.

5,195 e-buses deployed under FAME-II (31 Jan 2026), of 6,862 sanctioned. 10,000 PM-eBus Sewa buses sanctioned in 116 cities (Mar 2026). ₹57,613 crore PM-eBus Sewa estimated cost. 14,028 e-buses supported under PM E-DRIVE (₹4,391 crore). 523 e-buses deployed under PM-eBus Sewa–PSM (10 Jul 2026). Sources: Ministry of Housing and Urban Affairs, Ministry of Heavy Industries, PIB.