So far, fares for public transport have been set on the premise that this mode of travel is used by the poor, who have no other means of meeting their travel needs. As such, fares have been kept low as a measure of social equity. This has resulted in most public transport systems being unable to recover their operating costs. It has, in fact, encouraged poorly operated systems that have been financially sustainable only through serious compromises on the quality of the service they render. In the present day context, however, public transport serves another social purpose. It helps reduce congestion and air pollution, if users of personal vehicles can be persuaded to shift to public transport. Their needs are, however, for improved quality and not so much for low fares. It is, therefore, necessary to think of different types of public transport services for different segments of commuters. Those who place a premium on cost are the poorest sections of society and need to be given affordable prices. The cost of providing public transport for them needs to be subsidized by other sections of society. However, there is another segment that values time saved and comfort more than price. This segment is comparatively better off and would shift to public transport if high quality systems are available to them. The cost of providing public transport to them need not be subsidized and can be met from the fare revenues. As such, the Central Government would encourage the provision of different levels of services - a basic service, with subsidized fares and a premium service, which is of high quality but charges higher fares and involves no subsidy.

To facilitate this, the Central Government would offer support under the NURM for premium service infrastructure such as improved bus stations and terminals, improved passenger information systems, use of intelligent transport systems for monitoring and control, restructuring of State Transport Corporations, etc.

To ensure that the fares charged are fair and reasonable, the Central government would require that a regulatory authority be set up by the State Government to, inter-alia, regulate the prices to be charged by different types of public transport services.

There is a wide spectrum of public transport technologies. At one end are high capacity, but high cost, technologies like underground metro systems and at the other are low capacity bus systems running on a shared right of way. Within these extremes are a range of intermediate possibilities, such as buses on dedicated rights of way, elevated sky bus and monorail systems, electric 9 trolley buses, etc. While some of them are most effective over high density trunk corridors others prove useful as feeder systems or subsystems that serve limited subareas within a city. Similarly, there are examples of available waterways being taken advantage of for public transport as also systems like ropeways that suit hilly terrains. While the high capacity rail systems and buses on shared rights of way are the only ones tried out in India, several of the others have proved successful in other parts of the world. Electric trolley buses have been running in San Francisco. New Bus Rapid Transit Systems (BRTS) have become very popular in cities like Bogota (Colombia) and Curritiba (Brazil).

Each of these technologies has its unique characteristics and is best suited to a specific situation. Factors such as the urban form, terrain, availability of waterways, level of demand, direction and extent of sprawl, projections for future growth, extent of population density etc. are major determinants of the technology that should be chosen. The table at Attachment - I highlights the advantages and disadvantages of some of the available public transport technologies also indicating the technologies that best suit different local situations. While rail based systems seem to suit dense cities with limited sprawl and only a few spinal corridors, bus systems seem better where urban densities are lower and the city has spread over a large area. Given the wide range of possibilities, it is not possible to prescribe a particular technology in a generic policy and such a choice will have to be made as a part of city specific land use and transport plans. It would also depend on the kind of city that would need to evolve at the particular location. The Central Government would, therefore, encourage all proven technologies and not promote any specific technology. In order to facilitate the proper evaluation of all the available 10 technologies around the world, it would create a knowledge center that would provide the necessary information required for taking the right technological decisions for a specific city. Wherever necessary, support would be provided for techno-economic studies to be conducted by leading global consultants.

All cities have corridors that have varying densities of travel and hence need technologies that best match the level of demand on the corridor. This often requires different operators managing such systems. However, a good public transport system is one that is perceived by the user as a single system and allows seamless travel between one made and the other as also between systems managed by different operators. Such seamless interchange is possible if proper inter-change infrastructure is available and users are able to use a single ticket over all such systems. This also requires that a single agency takes responsibility for coordination so that there is a common approach to public transport planning and management.

Accordingly, the Central government would expect that investments in public transport systems would also seek to ensure that such systems are well integrated and offer a seamless system to the users. Central government's financial support would be contingent on appropriate authorities/entities being set up to ensure that a coordinated and integrated public transport system becomes available.