Centre Grants Subsidies For 10,900 Electric Buses In Five Cities Under PM e-Drive Scheme

The Centre will subsidise 10,900 electric buses for Delhi, Gujarat, Karnataka, and Telangana, the Ministry of Heavy Industries announced on Thursday, with the buses set to operate in Delhi, Bengaluru, Hyderabad, Ahmedabad, and Surat

Heavy industries minister HD Kumaraswamy chaired a meeting to review the rollout.

“From Bengaluru to Delhi, cities are actively embracing electric buses to make public transport cleaner, smarter, and more efficient,” he said.

City-Wise Allocation Under PM e-Drive

The government has, however, allocated 4,500 electric buses to Bengaluru, 2,800 to Delhi, 2,000 to Hyderabad, 1,000 to Ahmedabad, and 600 to Surat. These buses are being deployed under the PM e-Drive scheme.

The Centre plans to subsidise 14,028 electric buses with a total budget of ₹4,391 crore. This accounts for 40% of the scheme’s total outlay.

Funds will be utilised till FY26 to boost intra-city green mobility in nine large cities.

Cities covered include New Delhi, Mumbai, Bengaluru, Hyderabad, Chennai, Kolkata, Ahmedabad, Surat, and Pune.

Aanchal Jain, CEO of PMI Electro Mobility, which had an orderbook of 2,845 electric buses in February 2025, however, welcomed the initiative.

“This progress highlights a strong collective push for cleaner, smarter mobility,” Jain said.

Funding Model & Rollout Plan

As per the scheme, the government, however, offers ₹20–35 lakh in subsidies per bus. Buses measuring 6–8m get ₹20 lakh; 8–10m get ₹25 lakh; and 10–12m receive ₹35 lakh.

After the memorandum of understanding is signed between state transport utilities and selected bidders, the Centre will release 20% of the subsidy in advance.

Another 30% will be paid when operations begin. A further 25% will be released after six months of successful service. The final 25% will be paid after 18 months of operations.

A competitive bidding process by Convergence Energy Services Ltd will facilitate procurement for state utilities.

The move follows a slowdown in FY25. Sales of electric buses fell 5.7% to 3,314 units in FY25 from 3,516 in FY24, Vahan data showed.

The adoption rate also dropped to 4.72% in FY25 from 9.34% in FY22.

Kumaraswamy said the Centre is working closely with states like Telangana, Karnataka, Delhi, and Gujarat to promote sustainable public transport.

“We are shaping the future of India’s transport system with innovation and environmental consciousness,” he said.

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