The Ministry of Heavy Industries has officially announced on October 28th 2024 officially announced the PM-eBus Sewa-Payment Security Mechanism (PSM) scheme, aimed at facilitating the procurement and operation of electric buses (e-Buses) across the country. This initiative is part of the government’s broader commitment to enhancing public transport while promoting sustainability through electric vehicles.
Introduction to the Scheme
The PM-eBus Sewa-Payment Security Mechanism aims to establish a Payment Security Mechanism Fund to mitigate payment delays and enhance financial security for Original Equipment Manufacturers (OEMs) and operators involved in public transport. By addressing the risks associated with payment defaults from Public Transport Authorities (PTAs), the scheme is expected to boost the deployment of electric buses under various government-sponsored programs.
Objectives of the Scheme
The key objectives of the scheme include:
- Payment Security: Ensure timely payments to operators by providing a safety net in cases of default by PTAs.
- Recouping Mechanism: Establish a framework for recovering funds from state governments or Union Territories (UTs) in cases of non-repayment by PTAs.
- Capacity Building: Support PTAs in developing necessary skills and adopting innovative technologies for effective e-Bus operations.
Salient Features of the Scheme
- Coverage: The scheme is designed to cover the procurement and operation of at least 38,000 e-buses.
- Target Beneficiaries: The primary beneficiaries will be PTAs and OEMs/operators participating in the scheme.
- Eligibility Criteria:
- PTAs must adopt the Gross Cost Contract (GCC) model for e-Bus procurement, or seek approval for alternative models.
- States/UTs must register a Direct Debit Mandate (DDM) with the Reserve Bank of India (RBI) to facilitate fund recovery.
- Duration: The payment security coverage will extend for up to 12 years for each bus deployed under the scheme.
Financial Outlay
The total financial outlay for the PM-eBus Sewa scheme is estimated at ₹3,435.33 crore, highlighting the government’s substantial investment in sustainable public transport.
Implementation Mechanism
The implementation process involves several steps:
- Escrow Account: PTAs will maintain an escrow account for processing payments to OEMs/operators.
- Billing and Invoicing: OEMs/operators must submit regular invoices to PTAs. If payment defaults occur, they can invoke the Payment Security Mechanism.
- Disbursement of Funds: The Convergence Energy Services Limited (CESL) will review and approve requests for fund disbursement from the Scheme Fund.
Repayment Mechanism
In cases of default by PTAs, a structured repayment mechanism is in place:
- PTAs are required to repay the entire amount disbursed, including any applicable late payment surcharges, within 90 days.
- If repayment is not made, the MHI will request the RBI to invoke the DDM, enabling automatic recovery from the accounts of the respective state governments or UTs.
Steering Committee Oversight
A steering committee has been constituted to oversee the effective operation of the scheme. It comprises representatives from various ministries and will ensure that the objectives are met and the scheme runs smoothly.
Implementing Agency
Convergence Energy Services Limited (CESL) will serve as the implementing agency for the PM-eBus Sewa scheme, tasked with operationalizing the framework and ensuring compliance.
Conclusion
The launch of the PM-eBus Sewa-Payment Security Mechanism is a significant step towards transforming public transportation in India through the integration of electric buses. This initiative not only aims to reduce environmental impact but also ensures a reliable and efficient public transport system.
