The Bombay Electricity Supply and Transport Undertaking (BEST), Mumbai’s public bus service, has been an integral part of the life of the city’s residents for a century, supporting its thriving economy. Until a decade ago, it was a source of pride and a model for other Indian cities. However, its decline is now evident, largely due to a lack of transparency in decision-making regarding its operation and revival. As an environmental activist advocating for sustainable cities and a lifelong BEST user, I find its current state deeply saddening.

The Brihanmumbai Municipal Corporation (BMC) and BEST directly oversee the service’s operations and finances. Two key factors have contributed to its decline: first, the freezing of minimum fares at an unsustainably low level in 2018, and second, the complete transition to electric buses under the guise of green initiatives. Here, I discuss the impact of fare policies on BEST’s struggles.

Read more: Banking on contract buses, BEST to scrap three-quarters of its own fleet in a year

Low fares and subsequent losses

In 2017–18, BEST fares were lowered—the minimum fare was set at ₹5 for non-AC buses and ₹6 for AC buses. This came when BEST had been struggling financially for about a decade. The decrease in fares was ostensibly to increase ridership, but a bus service requiring passengers to wait 30–60 minutes will only drive them away. The city lacks a functional Unified Metropolitan Transport Authority, as mandated, and does not have a Fare Fixation Committee to ensure informed and transparent decision-making. 

Currently, BEST’s cumulative losses stand at about ₹10,000 crore with monthly losses of ₹200 crore. The bus fleet has shrunk and privatisation efforts have failed, prompting discussions on the sale or redevelopment of bus depots. 

Since the decoupling of BEST’s electricity supply and transport divisions, the latter has had difficulty managing its finances. Until 2003, the losses in the transport division were subsidised by the surplus in the electricity division. A small surcharge on every unit of electricity consumed by Mumbai residents provided necessary funds. After the electricity reforms in 2003 and the move towards privatisation, it was considered incumbent to phase out the cross-subsidy.

Reasons to consider full cost recovery fares

I strongly contend that a full cost recovery fare should have been considered at the time—gradually increasing fares annually to narrow the revenue-expense gap, while allowing alternative income sources to sustain service quality.  

Between 2003 and 2010, as public policy became sophisticated, new instruments that were designed to handle financial dilemmas like the ones faced by BEST emerged—balancing essential services for millions with fiscal sustainability. 

Cities like Singapore had already demonstrated the use of policy tools like electronic road pricing, vehicle registrations and capturing land value to subsidise public transport. Meanwhile, the 1990s and 2000s saw yearly study tours by bureaucrats and top politicians to leading global cities under the pretext of learning best practices that could be implemented in Mumbai.

This was also the time when India was reaping the benefits of economic liberalisation introduced in 1991, and this led to higher incomes, economic mobility, and new employment opportunities for citizens. Therefore, many BEST users were in a position to pay higher fares. 

A service with a guaranteed three million users should never be at a loss. Funding can always be secured for essential public services. Those opposing fare increases or proposing lower fares must realise that efficient services require financial resources.

Read more: BEST no longer: How contract buses are hampering services in Mumbai

Increase in fares: A welcome move

The BEST management recently doubled the minimum fare to ₹10 for non-AC and ₹12 for AC services to curb losses—a move I support despite widespread criticism from political parties and civil society.

Over the past few years, peak-hour wait times have ranged from 30 to 60 minutes, with infrequent buses leading to severe overcrowding. Only the fittest manage to board on the first attempt, while many must let multiple buses pass before securing a spot.

Commuters are not demanding lower fares; their primary concern is bus frequency and reduced waiting times. While comfort matters, nothing outweighs efficiency in a city where time is money. People are willing to pay a fair price, as they do for other essential goods and services.

Targeted subsidies

BEST is used by a wide cross-section of society. There are enough wealthy individuals who regularly used BEST in its heyday and did not see it as a social stigma. 

Policy and planning best practices emphasise refining policies to maximise benefits rather than relying solely on averages. Fare subsidies should be tailored to those in need, based on the extent of their financial capacity—whether a daily wage labourer, an office assistant, a teacher, or a businessman.

Read more: The case for merging Mumbai’s suburban public bus systems

Contrary to the current regressive approach to fares, I argue that at least 50% to 75% of BEST commuters would be happy to pay a full cost recovery fare, if they are provided an honest and efficient service.

It is worth introspecting on the fact that in the financial capital, we are implying that a large part of the population cannot pay a fare of ₹10. That underscores a much bigger problem than the financial troubles of BEST.

The abundance of digital data at our disposal should enable us to accurately identify segments of a population which genuinely need help. There are existing welfare schemes for specific target groups. For example, the BMC itself has a gender budget, which can be used to subsidise tickets for working women from low-income groups. Similar schemes exist for senior citizens and children at BMC schools. A portion of the funds in these schemes can be diverted to BEST.

A simple solution for Mumbai’s mobility needs

Moreover, the past decade has seen enthusiastic discussions in professional think tanks and corporate circles on climate finance, green bonds and impact investing. An efficiently run BEST is a step in this direction. Yet, these professionals have not made this connection persuasively.

Meanwhile, the 400-km Metro network across the Mumbai Metropolitan Region is celebrated, despite its full deployment being far off, while the readily available 2,000 kilometres of road network, capable of providing immediate mobility relief through buses, is overlooked.

Big-ticket infrastructure projects dip into the same pool of public money and are implemented by those who raise a hue and cry about BEST’s finances. A single BEST serves more people daily than all the other projects, including the operational Metro lines. It is time we took the revival of BEST seriously and attended to the mobility needs of almost half the population of Mumbai. 

Also read:

• “Recognise their cultural significance,” says activist on the last day of the double decker bus
• Inaccessible public transport: Difficult and expensive travel for differently-abled
• Accessibility: Mumbai’s lifeline can make lives of people with disabilities easier, but how?