KARACHI, June 4 Much-needed CNG-powered buses will start plying on 40 designated routes in the city any time during the next financial year as the ground work for the launching of the scheme has been completed in all respects, according to well-placed city government officials.

The government was now looking to the banking sector to offer financial packages to the public transport operators interested in bringing the CNG buses to the city, said sources privy to the Karachi Mass Transit Cell.

The sources said that almost every aspect of inducting the environment-friendly CNG buses under the public-private partnership had been discussed and proposed facilities documented to attract private parties to the venture. “Now banks are being approached for financing the exclusive CNG bus scheme on a priority basis as part of their corporate and social responsibility,” they added.

For more than four years, government functionaries have been stressing that induction of CNG buses into the city's public transport fleet is the best solution to the growing transport demand, travel delays, severe traffic congestion, clumsy routes, alarming levels of noise and air pollution and vehicular emission.

The Director-General of the city government's Karachi Mass Transit Cell, Malik Zaheer-ul-Islam, told Dawn that the federal, provincial and city governments had acted jointly in this direction and completed the homework.

“I have been working on the scheme for some year. I am now optimistic that the CNG buses will start plying on 40 designated routes any time during the next financial year,” he said.

Recently, the federal government approved financial support on a public-private partnership basis. Interested bus operators will be offered a package that includes an interest subsidy on loans/lease amount obtained from banks or financial institutions for the procurement of CNG buses, according to Mr Islam. He said that between 500 and 1,000 CNG buses were expected to be brought to the city roads in the first phase under a special plan which would also be replicated in nine other major cities of the country.

Existing bus fleet obsolete

Public transport and mass transit facilities providing a swift and hassle-free travel to citizens has been a pressing issue of Karachi, a city of 18 million people having an urban sprawl of about 3,500 square kilometres.

It is estimated that about 11,900 mostly obsolete buses of varying sizes and shapes ply on about 255 routes, which overlap considerably with each other. The existing bus fleet is not only very old but is also insufficient for a big city like Karachi. The buses have diesel-operated engines and are responsible for the increasing environmental pollution.

According to a study conducted by the Japan International Cooperation Agency around 6.9 million people used public transport vehicles, 2.3 million motorcycles and 3.3 million cars in 2008. The number of public transport users may top 11.6 million in 2015.

Saddar, Gulshan, Liaquatabad and Jamshed towns are the most travelled or touched areas, the study says.

In its attempts to solve the public transport issue, particularly after the closure of the Karachi Circular Railway, the first city district government of Karachi inducted jumbo-sized CNG buses and similar UTS buses with special operating subsidies and facilities about six years back under a plan to induct a total of 10,000 CNG buses. However, about 300 such buses, 28 of them air-conditioned, started going off the road reportedly due to a lack of interest and financial support on the part of the federal and provincial governments.

Early failure

According to officials familiar with the UTS scheme, the operators had to face a lot of problems that they attributed to the CDGK's attitude, federal and provincial governments' policies and unfriendly police and other agencies. The buses consumed 58 per cent more fuel than what the manufactures had claimed. Besides, the route allocation was faulty, depots could not be made available, relaying of roads and construction of flyovers were delayed and mini-buses and old buses were not phased out with the launch of the UTS buses, said a source recounting the problems.

While the demand for a reliable and swift transport system remained pressing, a relevant study costing Rs12 million was approved and conducted by the federal government in August 2005. The PC-1 of the scheme was cleared in February 2007. However, in the meantime, executive agencies of the UTS bus project also kept changing. Now the ministry of environment has undertaken the responsibility of overseeing and implementing the project, it is learnt.

Federal cabinet intervenes

After a long round of procedural obligations, the federal cabinet endorsed the features of the CNG bus projects with additional comforts in favour of bus operators to make the project “more viable and sustainable” in July 2008, said another source, adding that a Rs5 billion subsidy, including Rs2.5 billion for Karachi, had been approved by the federal government for provision of 4,000 CNG buses for 10 cities.

It is said that an amount of Rs160 million out of Karachi's share for the model project has also been transferred to the Sindh government but officials believe that any practical utilisation may be possible some time in late 2009. The standards for bus capacity will be 100 passengers (40 seating and 60 standing) and 70 (25 seating and 45 standing).

The source said that a high-level meeting with the heads of financial institutions and operators in Karachi in coordination with the State Bank was essentially required to ensure bus loans programme in the light of the federal government's guidelines.

During a meeting in Karachi on April 20, President Asif Ali Zardari reviewed the CNG bus scheme — now also known as the Shaheed Benazir Bhutto CNG Bus Project — and some other development projects. He also directed that initially 500 environment-friendly buses be introduced in Karachi by December 2009.

The scheme will be extended to the entire country and the number of such buses will be increased to 4,000 by 2012.

In Karachi, the scheme would be implemented by the CDGK, said an official source.

Financing & subsidy

Malik Zaheer-ul-Islam said that if things went in the right direction, the KMTC, through the CDGK, would enter into an agreement for the provision of a high-quality bus service offering affordable fare structure.

Giving the details of a subsidy on financing, he said the government had agreed to allocate Rs677,181 as a subsidy, which included an upfront payment of Rs300,000 and Rs377,181 as an interest subsidy payable in 60 equal instalments in five years, against the purchase of each CNG bus.

The subsidy would be provided to an operator having a minimum of 25 CNG buses at his disposal. The buses could either be imported or locally manufactured, he added.

In reply to a question, he said it was the banking sector that had to play a positive role to realise the dream of an improved public transport system for Karachi. A crucial meeting under the aegis of the State Bank would be held shortly in this regard, he said.