Explained: How different procurement modes reduced EV bus prices for cities

The recently concluded procurement of 5,450 electric buses — the largest so far in India — is set to change the way state transport authorities operate buses. 

Five cities — Delhi, Bengaluru, Kolkata, Hyderabad and Surat — ceded their power of procurement and agreed to a different procurement model to operate state-run buses. The Centre’s policy thinktank, NITI Aayog, brought these cities/states and all stakeholders on a common procurement portal, which harmonised standards and specifications for the procurement that helped in aggregating demand.

Moving away from the “inefficient” own-and-operate model, city governments decided to “procure, maintain and run” buses over a 12-year