BEST asks for another loan, this time Rs 1,500 cr
Having accrued losses of Rs 3,500 crore and already under a debt of Rs 1,600 crore, cash-strapped BEST needs another loan; ramshackle fleet and staff crunch still hinder operations
The Brihanmumbai Electric Supply and Transport (BEST), the loss-making civic undertaking on which 43 lakh commuters depend for daily transport and another nine lakh for the electricity in their homes, wants another loan of Rs 1,500 crore, with an additional overdraft of Rs 225 crore. Sources said that the loan is to pay off previous debts and stay afloat in general.
Some 450 buses that are in a state of disrepair lie idle
at depots every day, up from 250 recently
The BEST administration has approached a nationalised bank for procuring the loan and is awaiting the approval of the BEST Committee, a group comprising representatives from political parties. As per the proposal, the body is obtaining the loan at an interest rate of 10.75 per cent.
Till date, BEST has incurred a cumulative loss of around Rs 3,500 crore. "The transport department has incurred a loss of around Rs 350 crore while the supply division suffered a loss of Rs 250 crore this year alone. They already took a loan of around Rs 1,600 crore last year, which is still being repaid," said BEST committee member Ravi Raja.
The undertaking says it needs the funds for the maintenance of buses, which break down routinely. Sources said that the number of out-of-order buses that stand idle at depots every day has touched 450 from 250 recently, owing to the lack of funds for repairs, not to mention a staff crunch.
Though around 600 new buses were purchased to make up for the tumble-down fleet, BEST is now struggling to find parking space for them. Sources also said that while purchasing these buses, additional costs were incurred due to price fluctuations.
But BEST officials maintain that they incurred the cost while retrofitting the buses, converting them from diesel to CNG and modernising them with LED destination display boards among other modifications.
Furthermore, the 282 King Long buses have turned out to be the metaphorical white elephant for BEST, as they collectively invite daily losses of up to Rs 75 crore.
"We are taking Rs 1,500 crore as working capital for carrying out daily administrative works," said a senior BEST official on condition of anonymity.
The supply division is doing no better, and BEST blames the Maharashtra Electricity Regulatory Commission (MERC), which refused a 15 per cent hike in BEST's power tariffs.
'Why the loan?'
Sunil Ganacharya, a BEST Committee member, has questioned the loan demand, saying that for the last five years, the body's supply division has been earning profits now to the tune of around Rs 2,400 crore, so why does it need the money?
He further said, "The BEST has procured new machines for testing meters. But a majority are in a non-working condition."
BEST Committee Chairperson Sunil Shinde said, "The proposal for obtaining the loan hasn't been put up yet. But we can assure you that there wouldn't be any hike in fares."