MSRTC’s ₹10,000 Crore E-Bus Contract Cancelled: A Wake-Up Call for Accountability in Public Transport
In a significant development that highlights the growing demand for performance and transparency in government contracts, Maharashtra Transport Minister Pratap Sarnaik has ordered the cancellation of a ₹10,000 crore electric bus deal with the Olectra-Evey consortium. The move comes after repeated missed deadlines and failure to meet contractual obligations, raising serious questions about project execution and oversight.
The Contract: Ambitious Goals, Underwhelming Delivery
Signed in November 2023, the agreement aimed to revolutionize Maharashtra’s public transport system by adding 5,150 electric buses to the MSRTC fleet over two years. The shift was part of a broader push toward green mobility and reducing the carbon footprint of mass transit.
But as of May 2025, only 220 buses had been delivered—a shocking shortfall compared to the target of 1,935 buses due by January. Despite a grace period and a revised deadline to deliver 1,287 buses by May 22, the suppliers failed to deliver a single additional unit.
Operational Impact and Public Backlash
The delay has had real consequences. MSRTC caters to more than 5.3 million daily commuters, many of whom rely on its services in remote and rural areas. The shortage of buses has led to longer wait times, reduced frequency, and mounting public frustration.
In response, the Transport Minister has acted swiftly, instructing the immediate termination of the contract. He emphasized that “public interest cannot be compromised” and that such large-scale projects must maintain transparency, speed, and efficiency.
Political Fallout and Investigations
Chief Minister Devendra Fadnavis has ordered an inquiry into the tendering process, which allegedly caused a loss of ₹1,700 crore to the state due to unauthorized work orders and contractual lapses. If irregularities are found, strict action is expected against those responsible.
Strategic Shift: From Leasing to Ownership
MSRTC has now revised its strategy. Instead of relying heavily on leased buses, it plans to directly purchase 25,000 buses over the next five years. This includes 3,500 buses in 2025 alone, with 2,200 to be purchased outright and 1,300 brought in on lease. The goal is to restore public trust and ensure better fleet reliability.
Market Impact: Olectra Greentech Takes a Hit
The fallout was not limited to transport circles. Shares of Olectra Greentech, one of the consortium’s key players, plummeted by nearly 13% following the announcement. The market reacted swiftly to concerns over the company’s execution capabilities and potential financial losses.
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