Most state governments have used less than half the funds given to them to buy public transport buses this year, according to the secretary of the union ministry for urban development, M Ramachandran.
Speaking to FE on the sidelines of a workshop conducted on ?Unified Metropolitan Transport Authority?, Ramachandran said, ?We do not want to blame anyone for the delay in availing the benefit within the stipulated time?. The states were given an exemption from the restrictions on expenditure when the general elections were announced.
The urban development ministry had approved the purchase of around 14,240 buses, well before the code of conduct came into force. While sanctioning proposals, it was made clear that states should place vehicle orders by March 31, 2009. The Election Commission had given its ?no objection? to the bus-procurement proposal with the rider that the actual delivery of the buses should happen after elections were over. But states failed to process the approval despite the permission.
?So far, different states have placed orders only for 9,000 buses, of which only a few hundred buses were delivered by the bus manufacturers?, Ramachandran said.
Some state governments were asked to form separate special purpose vehicles (SPVs) to finalise the procurement of buses. ?Some states were able to form SPVs, while others have taken the process through transport corporations,? he said, adding, ?In Karnataka, the buses procured under the package are plying only between Bangalore and Mysore .?
State governments and state-owned transport corporations were given about Rs 4,000 crore under the Jawaharlal Nehru National Urban Mission to procure 15,000 buses for 60 cities across the country. Under the scheme, which was a part of the second stimulus package announced by the Centre in January, states provide assistance for the purchase of buses to develop their urban transport systems.
Of the total Rs 4,000-crore package, the Centre contributes Rs 2,000 crore, while the remaining amount is shared by the states and municipal bodies. So far the Centre has offered Rs 1,000 crore in the first phase for the states to go ahead with the purchase of buses, Ramachandran added.
Now, urban development minister Jaipal Reddy has indicated that the scheme will be extended beyond the stipulated time. In the meetings with the finance ministry in the run up to the General Budget on July 6, it also proposed that buses meant for urban transport with more than 20 seats, be exempted from value-added tax and the central excise duty. One of the aims of the scheme is to boost sales from the commercial vehicles industry, which had taken a brutal hit due to the recession.
The stipulated time set to avail the benefit under the package was June 30, 2009.