'End PSU monopoly in road transport'

The Competition Commission of India has asked all states to take steps to end the public sector's monopoly in road transport in order to promote competition.

This could be done by allowing more private-bus operators to ply on profitable as well as non-profitable routes within the state and between two states, the commission has said.

The recommendations follow a market study carried out by the commission in seven states, taking into consideration three key parameters - competition, efficiency and consumer satisfaction.

Based on the study, Rajasthan was ranked as the most competitive state, while Maharashtra was ranked the least competitive.

However, while individual states were ranked differently on separate indices, in terms of overall consumer satisfaction, Rajasthan was followed by Maharashtra, while the hilly state of Himachal Pradesh was at the bottom of this list.

At the policy level, the study has proposed that passenger transport services be provided through public and private participation on the basis of competitive bidding as well as franchisee operations. In addition, the study calls for a "controlled competition" with regular renewal of rights to operate services.

The study also calls for ensuring a minimum fleet size to be maintained by the franchisees as an efficiency enhancement measure. It calls for a road transport regulator who, among other things, would regulate fares, ensure fair play in the market as well as plan and develop the bus service network.

Asked for a comment, Brihanmumbai Electric Supply and Transport (BEST) Committee Chairman Sanjay Potnis said: "While allowing private operators, the state government should help the public operator to upgrade its fleet and induct more buses."

On the other hand, an Ahmedabad-based private bus operator, who operates services across West India, said: "Any decision (in implementing the study recommendations) will improve the quality of bus services across India. These moves would also force state government machinery to match up with the service and quality provided by private players like us".

The operator added that passengers would not mind paying higher fares for enhanced services.