Innovative Urban Transport Cooperation by Public and Private Sectors in India

Document Type

Journal Article

Publication Date


Subject Area

planning - service quality, ridership - commuting, place - urban, mode - mass transit, mode - subway/metro


Transit, Teamwork, Service quality, Quality of service, Public transit, Public sector, Private sector, Private enterprise, Passenger service quality, Outsourcing, Operational efficiency, Mass transit, Local transit, Indore City Transport Services Limited, Indore (India), India, Governments, Cooperation, Contracting out, Collaboration, Bangalore Metropolitan Transportation Corporation, Bangalore (India)


Institutional arrangements for public transport operations in Indian cities typically fall into two categories: an established state transport corporation (STC) or informal public transport services provided by the private sector. In 2006, the Ministry of Urban Development (MoUD) articulated a national vision to improve public transport in India. A key element of the vision is to vastly improve public transport in organization, efficiency, and overall quality. Although adopted before MoUD’s urban transport policy was enunciated, the various reform strategies implemented in Bangalore and Indore in India are excellent models of providing public transportation efficiently and effectively. Since its creation in 1997, the Bangalore Metropolitan Transport Corporation (BMTC) improved its operations efficiency and eliminated its operating deficit. BMTC uses a two-pronged private-sector approach—outsourcing selected activities and operating like a private company by selling services and commercializing capital assets. BMTC focused on service quality and efficiency and now is the only large profitable STC in India. The city of Indore used a different approach. It created Indore City Transport Services Ltd. (ICTSL), a municipal corporation that implemented a new formal public transport system entirely operated by competitively procured contract operators. ICTSL’s entire business, from operations to maintenance to advertising, is outsourced. A new, unique operating model in India, ICTSL created incentives to ensure service and quality by maintaining a competitive environment with a large number of operating contracts and operators. It successfully provides affordable and reliable services where previously there was no formal public transport provider.