India will have 50,000 electric buses on roads by 2027
India is working toward having 50,000 electric buses on its roads by 2027, thanks to a $390 million (around Rs. 3,254 crore) joint finance mechanism with the United States. Currently, India has only 12,000 operational e-buses. The fund will serve as an assurance for manufacturers seeking loans to increase production, officials from India and the US mentioned during a side event at COP28.
Joint forces for e-bus expansion
The payment security system is established with $240 million from the Indian government and $150 million from the US government and philanthropic organizations. It will serve as the foundation for risk management in the widespread development of the financial system for electric mobility in India. Mahua Acharya, a government official leading the introduction of the first e-buses in the country, emphasized its critical role.
New fund will address production challenges
To lower the cost of electric buses, India previously introduced "transportation as service." Under this model, manufacturers rent buses to public entities and collect monthly payments for 12 years. While this allowed local authorities to spread out costs and afford more buses, it led to a production lull as vehicle makers faced uncertain returns and long-term debt. The new fund mechanism aims to reduce manufacturers' risks when accessing finance for new investments.
US climate envoy applauds initiative
US climate envoy John Kerry is excited about the joint finance mechanism, saying, "That is speed, scale and impact and it is precisely what we need to do across every component of the [decarbonization] challenge." This collaboration between India and the US highlights their commitment to tackling climate change and promoting sustainable transportation solutions. The initiative is expected to significantly contribute to global efforts in reducing greenhouse gas emissions and transitioning toward a greener future.
