Given the speed of urbanisation in the country, there is an urgent need to develop mass public transit systems as quickly as possible. Indeed, a number of metro rail and bus rapid transit (BRT) projects have been promoted, conceptualised and implemented in the recent past. New policies such as the Metro Rail Policy, 2017, have also been put in place to stimulate private sector participation.
At present, metro projects are operational in Delhi, Bengaluru, Kolkata, Gurugram, Jaipur, Chennai, Lucknow, Kochi and Mumbai. Apart from this, BRT systems have been operationalised in 10 cities covering a total length of over 250 km. Over 75 km of metro systems have been added and over 200 km approved since April 2016.
In addition, innovative new systems such as personal rapid transit and even hyperloop projects are being planned. Both are unproven technologies and it remains to be seen if these fructify. Up to seven PRT systems and two hyperloop systems are in the planning stage.
Urban mass transit presents multiple financial challenges at both the construction and operational stages. These are capital-intensive projects and it is almost impossible to recover costs from fares alone. In addition, the usual issues of land acquisition arise. The private sector has therefore been cautious about investments in this sector. If the private sector is to enter, there will need to be substantial advances in developing non-fare revenue streams.
However, there are plenty of opportunities for the private sector in terms of equipment manufacturing, and in terms of IT enabling mass transit projects. For instance, metro coaches and other components can be manufactured domestically. Smart fare systems as well as smart traffic management systems present other opportunities. Nonetheless, the bulk of funding is likely to come from public financing.
Given the accelerating pace of urbanisation, opportunities in this space will continue to expand. Innovative policies have to be designed to ensure that development is not impeded due to the inherent economic challenges.