Facing mounting losses along with the recent hike in Compressed Natural Gas (CNG) prices by 85 paise per kg, the Brihanmumbai Electricity Supply and Transport undertaking (BEST) have proposed a Re 1 hike in bus fare for which discussions and deliberations will start from November 19.
BEST officials claim that their demand for this hike will be discussed from next week and that they have proposed this hike to be implemented from April 2013.
Sources in BEST said that the CNG hike would further bleed the loss-making undertaking.
“There will be a Rs 6.08 crore hike in annual fuel cost, which will add to our burden. So we will further push for the Re 1 hike already proposed in October,” said a BEST official.
There are 4,524 buses in BEST’s fleet. Of these, 2,979 buses run on CNG while the rest operate on diesel. Officials added that following the hike in CNG prices from November 1, the undertaking would be paying Rs 33.25 per kg from the earlier Rs 32.40 per kg. As per the arrangement made, BEST receives its CNG supply 70 paise per kg cheaper than the open market.
“This hike demanded by the administration was made in October, much before the hike in CNG prices,” said Sunil Ganacharya, BEST Committee member.
If officials are to be believed, there is a possibility of the BEST even demanding a Rs 2 hike in fare instead of Re 1 to recover the 85 paise per kg hike in CNG prices.
The undertaking is already facing losses and recently took a loan of Rs 1,600 crore at 10 per cent interest from the BMC to pay off their short-term loans and pay salaries to their staff. The losses are around Rs 2,700 crore, for which various long and short-term loans have been taken.
So far, they have repaid around Rs 900 crore.
Number of BEST buses that run on CNG