Maharashtra State Road Transport Corporation (MSRTC) is preparing to lease out its bus stands for a period of up to 98 years under a revamped public-private partnership (PPP) model.This move is being seen as a strategic pivot by the cash-strapped corporation to convert idle or underutilised land assets into long-term revenue-generating opportunities. Under the proposal, private developers will not only be offered the right to redevelop bus stands but also be awarded contracts based on the share of commercial property they are willing to allot to MSRTC post-construction, rather than a one-time premium fee.
The proposed lease structure involves an initial agreement for 49 years, extendable by another 49 years. The transport department formally submitted this model to the revenue department in early June. The intent is to enhance the appeal of PPP contracts to developers while ensuring sustainable income streams for MSRTC through commercial leasing over nearly a century.
This model replaces the earlier structure in which MSRTC earned fixed payments from private parties, accumulating ₹32 crore over two decades from 45 developed bus stands. Though these investments also delivered upgraded facilities worth ₹23 crore, the revenue model proved inadequate against the backdrop of soaring losses. As of now, MSRTC’s cumulative debt stands at an unsustainable ₹10,300 crore—largely a result of subsidised fares and operational constraints.
With 598 bus stands and 251 bus depots across Maharashtra, the scale of potential redevelopment under this extended lease model is significant. The plan to increase the lease term from 60 to 98 years is expected to attract developers by aligning with prevailing real estate investment cycles and lending norms, which often favour long-duration land rights.Under the proposed framework, MSRTC will not demand upfront premium charges. Instead, developers will commit to offering a fixed percentage—likely a minimum of 30%—of newly developed commercial space for MSRTC’s use. This share will be leased out by the corporation, ensuring a monthly rental income that could support operational costs and reduce dependence on state subsidies.
An official from the transport department confirmed the shift, stating that the bidding process would now be more competitive, with developers expected to offer the highest share of commercial property rather than the highest monetary bid. This model is being positioned as a way to make redevelopment commercially attractive while preserving MSRTC’s public service objectives.According to state officials, the change in policy was necessary to attract credible developers for the next round of PPP-based redevelopments. In October last year, the state had already extended the lease term from 30 to 60 years for 72 more bus stations. That plan is now on hold as tenders are being reworked to reflect the 98-year lease proposal.
From a governance perspective, the longer lease model has the potential to professionalise bus stand operations, introduce modern passenger amenities, and reduce MSRTC’s financial stress. It also offers a climate-conscious approach to redevelopment by leveraging urban land more efficiently rather than encouraging sprawl.
Though the plan is ambitious, it hinges on strong institutional mechanisms to ensure that public interest is safeguarded over nearly a century of private participation. As Maharashtra continues to grow its transport footprint, this shift in MSRTC’s leasing framework could become a model for other states seeking to balance public infrastructure modernisation with fiscal responsibility.
Also Read : Ahmedabad to Build Foot Overbridges via PPP Model
