The September 30 deadline to convert all buses to CNG is likely to be botched up if the Delhi government is not quick on its feet
Deadlines to break
While answering questions on a live chat on a website (www.chat.india-today.com), Delhi transport minister Parvez Hashmi abdicated all responsibility of the state government to ensure the implementation of the Supreme Court cng order. "The commitment made to the honourable courts are being done by the manufacturers that they will be able to supply all the vehicles booked by March 31, 2001. The ministry of petroleum said that they will make cng available for these many vehicles. The role of the state government is to play the role of the nodal agency...." When the state government is so unwilling about the issue, it is hardly difficult to predict the fate of the deadline. Several question marks remain to be answered by various parties in the Delhi cng episode.
Busmakers: Both Ashok Leyland and telco claim they can manufacture 500 buses per month from April 2001. This means 6,000 buses by September 2001 -- less than half the total number of buses that run in Delhi. While Ashok Leyland claims it has orders for 2,051 buses, telco has bagged 4,600 orders. By October 2001, telco would be able to deliver only 3,000 of these buses at the rate of 500 buses per month. How does the company plan to deliver the remaining 1,000?
Conversion agencies: The only certified agency to convert old buses to run on cng is Nugas. The company seems to have taken on more than it can handle. Nugas has already taken orders to convert 4,200 buses. They can convert only two buses each day. This means they can convert a maximum of 360 buses by October 2001, that is, if they work on all 30 days in a month. G V Subbarao of Nugas 'hopes' that their capacity will increase to five buses per day, which would mean a total of 900 buses by October 2001.
Rare Technologies has taken conversion orders for 3,000 buses. They charge Rs 10,000 as booking amount. But, the State Transport Authority (sta) has refused to grant permission to the company as it doesn't have all the certificates. Sheetal Singh of the company says all tests that have to be conducted at the Indian Institute of Petroleum, Dehradun, have been successfully completed. Only the test for electromagnetic interference remains to be done at the Vehicle Research and Development Establishment in Ahmednagar, Maharashtra. Singh says this would take one day. Rare Technology is ready to give an undertaking to sta that it will not perform any conversions before getting all the certificates in place. sta isn't willing to honour this undertaking.
Jignesh Dhruve, director of Srimankar Gas Car Services Private Ltd, does not think that this will be a problem. "We have tied up with private agencies that are willing to give loans at 20 per cent rate of interest." The Delhi Finance Corporation has reportedly sanctioned loans for 350 conversions. Dhruve is unhappy about an 8 per cent sales tax that the government is charging on cng conversion kits. "The cylinders and other cng equipment does not draw sales tax so why the retrofitment kits?" he questions. If the kits are exempted from the tax, it would reduce the cost of conversion by Rs 1,400, a substantial amount for autorickshaw drivers.
The Delhi Transport Corporation (dtc) has already run into trouble over converting its buses as none of the five applicants to its tender meet the technical criteria. There are others who are negotiating an entirely a different kind of deal with dtc . Optaire (India) Private Ltd, affiliated with a British company, has offered to lease and operate a large fleet of specially designed urban buses. The company says its buses are very expensive and much beyond what the dtc or private bus operators can afford to pay, hence it would prefer to run them on lease. dtc doesn't need to make any capital investments. But this company is negotiating to bring in urban diesel buses as well. The company is willing to bring in cng buses, if so desired by the government, but wants a firm commitment from the government on gas supply. Even so, the company would need six months for trials in the uk , three months to get the prototype certified in India, and eight to nine months to build up capacities to roll out 200 buses per month. The Delhi government is apparently examining this proposal. Its main reservation is on the counter guarantee that they would need to give for a long-term lease of 10 years.
Clearly, it is the extremely small numbers of the players in the market that is strangulating the entire conversion process. The answer should have been to create healthy competition by inviting more Indian and foreign players. But no advertisement was taken out in international newspapers. Rules were set in a way that companies could not follow them easily. Government processes need to be streamlined to get more agencies in the market -- and fast. As experts in the areas of transport and environmental management point out, the quintessential question is of finance -- a large amount of money is required to finance the conversion of Delhi's public transport to cng and the private operators do not have that kind of capital.
The Delhi government won't solve this problem by playing into the hands of the diesel lobby. Nor will all the political posturing -- making statements that have contempt of court written all over -- help. The Delhi government needs to get out of the confusion it has imposed upon itself. Saying that cng is an experimental technology won't help. It would do better to address issues of ensuring safety, emission norms, market conditions for conversion and fiscal incentives for private operators. Otherwise October 1, 2001 will be a repeat of April 1. Public opinion is appreciative of the merit of the Supreme COurt order. The Delhi government needs to be on the right side of this issue of public health.
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