Climate action that runs on cooperative federalism

Rapid electrification is a key pillar of India’s public transportation. This pillar has the potential to reduce India’s pollution and its import bill. E-mobility- ‘Grand Challenge 1’ in this context is an innovative model for India and the world.

Issue: Status of State-owned Buses

• Sputtering engines: Currently around 1, 40,000 registered public buses on India’s roads, most of them having inefficient engines emitting planet-warming fumes into the atmosphere.
• Old Vehicles: At least 40,000 of these buses are at the end of their lifespan and must be taken off the roads immediately.
• States in poor financial health: It is disheartening to see that because of the poor financial health of states in addition to the responsibility of providing subsidized fares, it is a herculean task to overhaul the entire fleet of buses.
• Higher cost for buying buses: Due to fragmented demand the state transport undertaking often faces problems of higher prices while buying buses.
• Limitations on nationwide action: As state governments control issues such as transit, urban governance, and pollution control, it becomes difficult to find a unified solution.

Cooperative Federalism: A Success Story

• Unified Tender: Grand Challenge 1 is a great example of cooperative federalism. Under Grand Challenge 1, a unified tender for 5,450 buses across five major Indian cities was issued. This is for the 1st time that a unified tender to address the challenging issue of climate change has been issued.
• Coordination among states: The respective expertise, strengths, and needs of Union Ministries and States informed the process and the successful outcomes which need to be appreciated.
• Coordination with the center: Convergence Energy Services Limited (CESL), a nodal agency of the Union government, acted as the programme manager in this effort at centralized procurement in concert, with State-led demand and customization.
  • This coordination among central and state governments led to the discovery of the low price required to operate the buses.
  • On a cost-per-kilometer basis, the prices discovered were 40% lower than diesel and 34% less than CNG (without factoring in the subsidy through FAME-II).

The success of Unified Tender:

This change in the unified tender was enabled by three key factors collaboration, pace, and transparency.

• Consultative process: The tender itself was a fully consultative process. The different contributions by participants helped in influencing the design of future tenders also.
• Pace: There was a sense of climate urgency that shaped this collaboration.
• Transparency: Transparency was the strongest aspect of this tender. There was clarity about the intention to build trust and build a publicly available process that invited bids from automakers and operators.

Climate change and Indian Federalism:

• India cannot address climate change without re-imagining Indian federalism as the division of powers in the Indian Constitution gives states a crucial role in several arenas of climate action.
• This spans water, agriculture, cities, and transport – solely the responsibility of the states – and crucial levers in mitigation like forests and electricity, that are the joint responsibility of the federal government (hereafter referred to as ‘the Centre’) and the states.

Merits of decentralization decision in improving the climate conditions:

• Different state has different levels of vulnerability: India’s States and districts vary vastly in their vulnerability to climate impacts, and decentralized decision-making and locally-led adaptation will help reduce potential damage to the environment.
  • The role of urban local bodies and gram panchayats can be instrumental in the efforts towards climate action.
• Need for Balance: Excessive centralization has limitations and contradicts the federal principles enshrined in the Constitution. However, in cases such as, where States lack size and financial clouts, such as the electrification of mass mobility, centralized procurement, and programme management can deliver architectural transformations rather than just incremental transitions.