Nearly two years after the Delhi government submitted in High Court that it would gradually phase out Blueline buses by corporatising the private bus system, the cluster model meant to carry out corporatisation is yet to take off.

Reason: the Delhi government’s reluctance to hike DTC bus fares, and Chief Minister Sheila Dikshit and Finance Minister A K Walia sparring over subsidies to be offered to private bus operators who bid for the 17 clusters formed.

The corporatisation model was designed by the Delhi Integrated Multimodal Transit System (DIMTS) by dividing 657 bus routes across the city into 17 clusters. Each cluster has both profitable and non-profitable routes.

As per the model, the government would control bus fares while the private operator will be given a fixed amount — a rate per kilometre quoted by the operator per bus, and approved by the government.

DTC is supposed to run 60 per cent buses in each cluster.

The government had earlier finalised Janakpuri-based Starbus Limited’s bid of Rs 47.50 per kilometer per bus for the first cluster. According to officials, the mathematics was that the government would have to shell out a subsidy of Rs 27 per km per bus if Starbus’s bid — the lowest, say officials — was approved.

But Walia refused to approve it, contending the government will have to cough up Rs 85 crore annually to make the system run — unsustainable in the long run, according to the finance minister.

“Average earnings for a DTC bus is Rs 19 or Rs 20 per km on some profitable routes,” an official said. “And that leaves no incentive for private operators to run buses with the DTC on the same route.”

... contd.