Kerala Finance Corporation pulls plug on private bus operators, backs out of funding CNG conversion

Owners of 8 buses got Rs 4 lakh aid; corporation stops scheme after a few fail to pay EMIs on time
One of the buses that was retrofitted with CNG kit in Kochi (Photo | EPS, Arun Angela)
One of the buses that was retrofitted with CNG kit in Kochi (Photo | EPS, Arun Angela)

KOCHI: The private bus owners’ move to convert the buses to CNG to tide over the rising petroleum prices has received a major jolt. Kerala Finance Corporation (KFC), which had agreed to provide a financial assistance of Rs 4 lakh for converting each vehicle into CNG mode, is learnt to have scrapped the project.The corporation had given loans to convert eight buses into CNG engine in the state, but the sudden move has left the bus owners worried. 

According to members of the bus owners association, the government has made tall claims of reviving the private bus industry, which has been through a rough patch after the pandemic hit the country.“Though the government announced a big revival plan of providing loans for converting private buses to CNG, nothing happened. Now, KFC is not ready to sanction the amount that it had promised earlier.

Only eight buses in Kochi got the loan. They are not considering the applications of other bus owners. What is the point in announcing such a big revival plan? How can we fight the rising fuel prices?” asked George Joseph, member of the Private Bus Owners’ Federation and owner of the state’s first CNG-converted private bus. Bus owners said if a bus is run on CNG, it will help reduce the daily expenses by up to Rs 4,000. 

They believe that if the government provides a loan of Rs 4 lakh to meet the installation cost, the expense can be recovered within a year. Due to the hike in fuel prices, over 50 bus owners in Kochi alone are ready to switch to CNG. If the vehicle runs on diesel, it will be difficult to meet the daily expenses. KFC’s decision to scrap the loan scheme is unjust,” said a bus owner.

Meanwhile, it is learnt that KFC has issued an oral instruction to all its branches to withhold the loan distribution. Sanjay Kaul, IAS, who took charge recently as the managing director of KFC, took the decision after a few bus owners failed to repay the loans, it is alleged. 

“A few bus owners failed to pay the EMIs on time. If the situation remains so, this will add more burden on the corporation. Already, we have issued loans to nearly 10 bus owners. But a few people are not repaying it on time. We are forced to withhold the project for a few months,” said a top KFC officer.Kaul could not be contacted for comments despite attempts to reach him at his office.

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