Heavy Industries Minister HD Kumaraswamy announced that Karnataka will receive 4,500 buses, Delhi 2,800, Hyderabad 2,000, Ahmedabad 1,000, and Surat 600 in the first phase.
He said that this allocation meets 100% of the requests from Ahmedabad and Surat, 64% from Karnataka, and 71% from Telangana. Delhi’s full request of 2,800 buses was also approved.
The scheme, with a total budget of ₹10,800 crore, aims to distribute 14,028 buses across nine cities with populations over 40 lakh, including New Delhi, Mumbai, Bengaluru, Hyderabad, Chennai, Kolkata, Ahmedabad, Surat, and Pune, by FY26. Only five cities’ transport ministries have applied so far.
Kumaraswamy urged West Bengal, Maharashtra, and Tamil Nadu to submit applications, noting West Bengal cited judicial issues with the FAME-2 scheme, while Tamil Nadu is securing a World Bank loan for Chennai’s e-buses.
The PM E-drive scheme supports intra-city travel with subsidies of ₹20-35 lakh per bus, depending on size: ₹20 lakh for 6-8m buses, ₹25 lakh for 8-10m, and ₹35 lakh for 10-12m.
Subsidies will be disbursed in phases—20% after signing agreements, 30% upon operation start, 25% after six months, and 25% after 18 months. State-run Convergence Energy Services Ltd will conduct competitive bidding for state transport utilities to purchase buses.
In the second phase, the remaining 3,800 buses will be allocated based on further state demands, with Maharashtra, West Bengal, Karnataka, and Telangana expected to apply.
Electric bus sales in India dropped 5.7% in FY25 to 3,314 from 3,516 in FY24, with adoption at 4.72%, the lowest since FY22. The initiative aims to boost sustainable public transport in India’s major cities.
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