India Bus Market

India Bus Market Size and Share:

The India bus market size was valued at USD 2.24 Billion in 2024. Looking forward, IMARC Group estimates the market to reach USD 3.22 Billion by 2033, exhibiting a CAGR of 3.80% during 2025-2033. The rapid urbanization and population growth, which lead to increased demand for public transportation, including buses, to address the mobility needs of large urban populations, is driving the India bus market share.

Urbanization is among the key factors for the growth of the India bus market. Owing to swift population growth and growing migration into cities, the urban population in India is likely to keep on growing. This puts additional pressure on the already existing transportation system, and the result is higher demand for efficient public transport means. As cities get crowded, buses serve as a low-cost and efficient means of mass transit, with the ability to carry high volumes of passengers and alleviate traffic jams. Efficient transportation of people from one urban hub to another is increasingly becoming imperative, especially in megacities such as Delhi, Mumbai, and Bengaluru, where the availability of road space is dwindling. Buses are perceived as an accessible and scalable urban mobility solution; in cities where metro networks are expanding, buses are often used for connectivity at the last mile. Demand for new-generation eco-friendly buses grows as the urban community tries to introduce better public transport infrastructure to address their sustainability concerns.

Indian policymakers also have significant roles to influence the bus industry by means of a range of policies, efforts, and stimuli meant to advance mass transit facilities. Major initiatives such as Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) provide financial incentive to electric buses in the form of subsidies that can cut operating expenses for businesses in half initially. These incentives are meant to encourage the adoption of green, low-emission buses, as part of India's long-term vision to reduce its carbon footprint and address pollution. Several state governments are also adopting policies to retire old diesel buses and introduce electric buses, marking a transition toward cleaner transport. Financial incentives, tax benefits, and concessional loans also incentivize private operators to invest in newer, more energy-efficient fleets. These positive policies play an important role in spurring the uptake of newer, cleaner bus technologies, enabling a long-term revolution in India's public transport sector.

India Bus Market Trends:

Regional Emphasis on Sustainable and Eco-Friendly Transportation Solutions

In India, regional governments are increasingly focusing on sustainable and eco-friendly transportation solutions to combat pollution and reduce carbon emissions. This push for greener alternatives has significantly driven the demand for electric buses across various cities. States like Delhi, Maharashtra, and Karnataka are at the forefront of adopting electric buses to replace traditional fossil fuel-powered vehicles. These buses contribute to reducing air pollution and also align with the national goal of achieving net-zero emissions by 2070. The growing awareness about climate change and the need for cleaner air has made electric buses an attractive option for regional governments. In 2024, India recorded 3,616 electric bus registrations, according to the Vahan portal. Of these, 3,568 were in the heavy passenger vehicle (HPV) category and 44 in the multi-purpose vehicle (MPV) segment. E-buses made up 12.5% of the heavy segment and 6.2% of the overall bus market. Furthermore, electric buses have lower operational and maintenance costs in the long run, making them an economically viable choice. With favorable government policies and increased environmental consciousness, the adoption of electric buses is expected to rise steadily in both metropolitan and non-metropolitan regions.

Government Incentives and Subsidies to Encourage the Adoption of Electric Buses

To accelerate the adoption of electric buses, the Indian government has rolled out various incentives and subsidies under the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme. This initiative offers financial support to state governments, transport authorities, and bus operators, making electric buses more affordable. The government provides capital subsidies for the purchase of electric buses, which significantly reduces the upfront cost. The PM E-DRIVE scheme allocated INR 4,391 Crore for 14,028 e-buses in nine major cities and INR 2,000 Crore for charging infrastructure, including 72,300 fast chargers, with priority to cities scrapping old buses and special provisions for difficult terrains. Additionally, state-level incentives, such as tax exemptions and reduced road tax, further enhance the economic feasibility of adopting electric buses. These measures aim to foster a transition from conventional diesel buses to electric ones, helping reduce dependence on fossil fuels while promoting sustainable urban mobility. As cities like Delhi, Bangalore, and Mumbai expand their electric bus fleets, the role of government incentives becomes crucial in shaping the future of the India bus demand.

Urbanization and Population Growth Driving Demand for Efficient Public Transportation

India’s rapid urbanization and population growth have created significant challenges for metropolitan areas, including traffic congestion and inadequate public transportation systems. As the urban population increases, so does the need for efficient, reliable, and sustainable public transport options. The pressure on existing transportation infrastructure has led to a surge in demand for solutions like electric buses, which can alleviate traffic congestion and reduce emissions. Cities like Delhi, Mumbai, and Bangalore have witnessed a growing shift toward electric buses to cater to the increased passenger load while improving air quality. These buses provide a cleaner alternative to the overcrowded, pollution-heavy conventional buses. As per the TomTom Traffic Index 2024, Kolkata, Bengaluru, and Pune are among the five cities globally with the slowest traffic speeds. Buses, being versatile and cost-effective, serve as a vital component of these systems, providing a practical solution to alleviate traffic congestion and reduce individual reliance on private vehicles. Moreover, with rising fuel costs and the desire to meet sustainability targets, cities are investing in electric bus fleets as part of comprehensive urban mobility plans. The demand for efficient public transportation systems is set to rise further and facilitate a shift in the India bus market outlook toward efficient systems, as urban areas continue to expand.

India Bus Industry Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the India bus market, along with forecasts at the regional level from 2025-2033. The market has been categorized based on type, fuel type, seat capacity, and application.

Analysis by Type:

• Single Deck
• Double Deck

Single deck buses are a key segment of the India bus market, used mainly for intercity and urban transit. These buses are best suited for areas where passenger demand is less or where there is less space. Their relatively smaller size enables improved maneuverability, and hence they find use in crowded city roads. Single deck buses provide effective solutions for public transport, particularly in small towns and cities, and are commonly used in fleets for local travel. As the demand for environmentally friendly buses increases, single deck electric buses are also gaining popularity, providing low operating costs and less environmental footprint.

Double deck buses are picking up pace in India's urban and tourism industries because they have the ability to carry more passengers. Double deckers are frequently used for city tour sightseeing, long-distance transport, and high-density routes in big cities such as Mumbai and Delhi. Double-decker configuration provides greater seating capacity without occupying additional road space, making it a convenient solution for dense urban areas. Although generally perceived as luxury or high-volume offerings, they are being upgraded with electric or hybrid technologies and finding favor as India's public transport sector tries to align itself with sustainability ambitions.

Analysis by Fuel Type:

• Diesel
• Electric and Hybrid
• Others

Diesel-fueled buses have historically led the India bus market with reliable performance on urban and intercity routes. They are preferred for their extended range capacity and their capability to function effectively across weather conditions. Diesel buses are typically employed by public and private operators because of their initial lower cost over electric counterparts. They do, however, cause air pollution and emissions of greenhouse gases, contributing to increased concern about environmental sustainability. Even with the call for cleaner options, diesel buses continue to be a large share of the market, especially where there is still a developing infrastructure for electric buses.

Hybrid and electric buses are increasingly becoming popular in India as part of the country's push toward minimizing pollution and enhancing public transport sustainability. Battery-powered electric buses emit no emissions and consume less energy compared to diesel buses, thus are a cleaner substitute for them. Hybrid buses, which integrate electric and diesel power, have better operating flexibility. These buses are especially attractive for cities looking to decrease air pollution while enhancing city mobility. With government incentives, the increasing need for cleaner transport solutions, and better charging facilities, India's electric and hybrid bus market is anticipated to grow immensely.

Analysis by Seat Capacity:

• 15-30 Seats
• 31-50 Seats
• More than 50 Seats

15-30 seat buses are typically employed in small group transport, including corporate travel, school transportation, and short-distance commuters. They provide an efficient solution for moderate passenger demand areas. These vehicles are best suited for urban and suburban areas where flexibility, maneuverability, and efficiency are essential. Due to their small size, they can more efficiently navigate through heavy traffic lanes, and hence, private operators and smaller public transit systems favor using them.

Buses with 31-50 seats are used for medium-capacity requirements, which makes them suitable for intercity travel, regional operations, and medium-sized commuter services. These buses are balanced between having sufficient seating for passengers and yet being able to function efficiently in urban settings. They are often used in regional transit and private charter operations and are increasing in demand because of their versatility and cost-effectiveness. These buses are increasingly used for both short and long-distance travel, providing comfort while seating a greater volume of passengers.

More than 50-seater buses are designed for high-capacity transportation, generally employed on intercity, interstate, and long-distance routes. These buses are popular due to their capacity for carrying large numbers of passengers in an efficient manner, so they are widely used by state-run transport organizations, tour agencies, and long-distance travel. They are necessary for catering to the needs of city population expansion and growing demand for public transportation. These buses mostly have upgraded facilities such as air conditioning and upgraded seating for greater comfort on long-distance travel.

Analysis by Application:

• Transit Bus
• Intercity/Coaches
• Others

Transit buses are majorly utilized in urban public transportation, providing cost-effective solutions to commuting in the city. Transit buses are suited for shorter urban routes in city areas, giving frequent stops for passengers. These buses are suited for local traveling, connecting areas, transit stops, and commercial districts. As urbanization expands in India, transit buses play a crucial role in alleviating congestion and providing affordable, green alternatives to private vehicles, particularly in congested cities such as Delhi and Mumbai.

Intercity coaches or buses serve for long-distance travel between regions and cities. They are intended for comfort with amenities like reclining seats, air conditioning, and large storage space for luggage. Intercity buses serve as a suitable means of transport for traveling between big cities as they are cheaper and convenient compared to trains and flights. In India, with its widespread geographical coverage and increasing requirement for economic transportation, intercity buses play a crucial role in bridging the urban and rural spaces, serving both tourists and commuters.

Regional Analysis:

• North India
• West and Central India
• South India
• East and Northeast India

North India's bus market is controlled by the major urban hubs such as Delhi, Chandigarh, and Jaipur. The region also experiences high demand for transit buses and intercity coaches because it has a burgeoning population and growing urbanization. The use of electric buses is also increasing due to government efforts toward better air quality and decongestion.

West and Central India, such as the cities of Mumbai, Pune, and Indore, has a fast-growing bus market. The regions have an extremely high demand for local transit buses and intercity coaches due to their dense metropolitan cities and tourism sectors. The trend toward electric buses is also very prominent in these areas, with numerous cities opting for cleaner transport options.

South India, which includes cities such as Bengaluru, Chennai, and Hyderabad, boasts a strong bus market. Urbanization and high population density drive demand for both intercity services and transit buses. The area is increasingly turning to electric buses, spurred by government incentives and sustainability initiatives. Tourism also fuels demand for comfortable long-distance coaches.

East and Northeast India, with urban centers such as Kolkata, Guwahati, and Bhubaneswar, is experiencing an expanding bus market fueled by urbanization and enhanced connectivity. Demand for transit buses and intercity coaches is increasing as these regions grow economically. Government efforts are emphasizing the promotion of green buses, meeting both transportation requirements and environmental issues in these regions.

Key Regional Takeaways:

Uttar Pradesh Bus Market Analysis

Uttar Pradesh’s bus market is driven by its large and growing population, rapid urbanization, and the need for efficient public transportation systems in cities like Lucknow, Kanpur, and Varanasi. The state, with over 200 million people, faces significant transportation challenges, especially in crowded urban areas where buses serve as a reliable and affordable option for daily commuting. As the population grows, the demand for buses to reduce traffic congestion and provide better public transport connectivity is escalating. A key trend in Uttar Pradesh is the push toward electric buses, driven by the state government’s initiatives under the FAME scheme. The adoption of electric buses in cities like Lucknow is expected to reduce air pollution and offer long-term cost savings. Additionally, intercity bus services are growing rapidly, especially for religious tourism, with millions visiting places like Varanasi, Allahabad, and Mathura. The state is focusing on improving rural connectivity, ensuring buses reach underserved regions and enhancing overall transportation access across Uttar Pradesh.

Rajasthan Bus Market Analysis

Rajasthan’s bus market is driven by urbanization, tourism, and a growing need for efficient public transportation. Cities like Jaipur, Udaipur, and Jodhpur are witnessing rapid population growth, leading to increased demand for reliable transit options. Buses are a cost-effective mode of transport, especially in areas with limited metro or rail networks. The state’s expansive geographical layout also necessitates efficient intercity bus services, catering to both daily commuters and tourists. A key trend in Rajasthan’s bus market is the rise of tourism-based travel. The state, known for its historical sites and vibrant culture, attracts millions of tourists annually, boosting demand for comfortable and reliable intercity coaches. Additionally, electric buses are gaining traction in cities like Jaipur, driven by government incentives under the FAME scheme and the growing push for environmentally sustainable transportation. Rajasthan is also focusing on improving rural connectivity with state-run bus services reaching remote areas, ensuring that bus travel remains integral to the state’s transport infrastructure.

Karnataka Bus Market Analysis

Karnataka’s bus market is being driven by rapid urbanization, population growth, and the need for efficient public transportation in cities like Bengaluru, Mysuru, and Hubli. Bengaluru, as a major tech hub, faces significant traffic congestion, increasing the demand for reliable and affordable public transport solutions. Buses provide an effective way to address urban mobility challenges, offering an alternative to overcrowded private vehicles. A significant trend in Karnataka is the growing adoption of electric buses. The state government is encouraging the use of green transportation through initiatives like the FAME scheme, offering incentives to bus operators who switch to electric vehicles. Bengaluru has already begun deploying electric buses, which help reduce pollution and operating costs in the long term. Additionally, intercity buses are increasingly in demand, driven by Karnataka's large tourism sector and its well-developed road infrastructure. Improved comfort and convenience in these buses are also trends, as operators look to attract more passengers for longer journeys across the state.

Gujrat Bus Market Analysis

Gujarat’s bus market is experiencing growth driven by urbanization, rising population, and the need for efficient public transportation. Major cities like Ahmedabad, Surat, and Vadodara are witnessing increasing demand for buses to accommodate the growing number of commuters. As the state’s population expands, there is a clear shift toward sustainable and organized transport solutions, with buses offering an affordable and effective mode of travel. Several cities in Gujarat are adopting electric buses to reduce pollution and enhance air quality, aligning with national environmental goals. Additionally, intercity buses are gaining popularity in Gujarat, especially as the state’s extensive road network improves. The growing need for seamless travel between cities and towns is fueling demand for comfortable, long-distance coaches. These trends reflect Gujarat’s commitment to modernizing its bus infrastructure and offering sustainable transport solutions.

Madhya Pradesh Bus Market Analysis

The Madhya Pradesh bus market is driven by factors such as rapid urbanization, population growth, and the need for improved public transportation systems. The state’s growing urban areas, including Bhopal, Indore, and Gwalior, are seeing increased demand for reliable and efficient local transit options to reduce congestion and pollution. With a large population relying on public transport, buses are a cost-effective solution for daily commuting. In addition, the Madhya Pradesh government’s push for sustainability is driving the adoption of electric buses. The state has been part of the government’s Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) initiative, which offers incentives for electric bus fleets. This trend toward eco-friendly transport aligns with national goals for reducing carbon emissions. Furthermore, the state's efforts to improve intercity connectivity, particularly through the introduction of comfortable and efficient coaches, are fueling demand. These trends are contributing to the growth of Madhya Pradesh's bus market, ensuring a cleaner, more efficient future for transportation.

Competitive Landscape:

Key players in the India bus market are actively driving growth through various innovative efforts to meet the evolving transportation needs of the country. Manufacturers like Tata Motors, Ashok Leyland, and Volvo are focusing on the development of eco-friendly buses, particularly electric and hybrid models, to align with the government’s sustainability goals and to combat rising air pollution in urban areas. These companies are investing in R&D to improve battery technology, charging infrastructure, and vehicle efficiency, making electric buses more viable for mass adoption. Additionally, players are working on enhancing the comfort and safety features of buses, incorporating advanced technologies such as GPS tracking, real-time passenger information systems, and automated ticketing solutions to improve the overall passenger experience. To further support the growth of public transportation, bus operators are adopting fleet management software to optimize routes, reduce fuel consumption, and improve service efficiency. Public-private partnerships are also playing a critical role in scaling up the adoption of electric buses, with several states receiving financial incentives and subsidies under the FAME scheme. Furthermore, key players are expanding their production capacities and exploring new markets, including smaller cities and rural areas, where public transport systems are growing rapidly. These efforts contribute to the transformation of India's bus market toward cleaner, more efficient, and modern solutions.

The report provides a comprehensive analysis of the competitive landscape in the India bus market with detailed profiles of all major companies, including:

Latest News and Developments:

• February 2025: NueGo launched India’s first electric AC sleeper bus, targeting long-distance routes like Delhi–Amritsar and Bengaluru–Chennai. The buses offer ergonomic berths, ambient lighting, USB ports, and sanitation facilities, promoting eco-friendly travel with zero emissions, regenerative braking, and fast charging, while enhancing comfort and reducing fuel dependence.
• December 2024: SWITCH Mobility launched two new low-floor electric city buses, EiV12 for India and E1 for Europe. Designed for urban mobility, the EiV12 features a 400+ kWh battery, advanced safety, and accessibility, while the E1 offers lightweight construction and high capacity, supporting SWITCH’s global push for sustainable transport.
• September 2024: VECV introduced advanced bus solutions at PRAWAAS 4.0, including the upgraded Volvo 9600 Coach, Eicher Skyline Pro-E 13.5m electric intercity coach, and Skyline Pro 3010 school bus. These offerings highlight VECV’s focus on safety, comfort, connectivity, and sustainability in India’s changing public transport landscape.
• August 2024: Blackbuck EV expanded its ELON range with a new electric sleeper bus featuring 36 beds, luxury interiors, and up to 400km per charge range. With 350 units already preordered, production begins end-2025. Its EBAAS model offers fleet support, maintenance, and digital tools to streamline electric bus operations.
• August 2024: Ashok Leyland unveiled the GARUD 15M, India’s first front-engine multi-axle bus chassis, at Prawaas 4.0. Built for long-distance intercity travel, it features 42 sleeper berths, a 22,500 kg GVW, advanced safety tech, and ergonomic design. Commercial launch is set for Q4 FY25.

India Bus Market Report Scope:

Key Benefits for Stakeholders:

• IMARC’s report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the India bus market from 2019-2033.
• The research study provides the latest information on the market drivers, challenges, and opportunities in the global India bus market.
• The study maps the leading, as well as the fastest-growing, regional markets. It further enables stakeholders to identify the key country-level markets within each region.
• Porter's Five Forces analysis assists stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the India bus industry and its attractiveness.
• Competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.