NEW DELHI: The central government on Tuesday called proposals from state transport departments for the deployment of 5,000 electric buses , to be supported under the Fame-II scheme This is the first time that the country has issued such a large tender for electric buses. The selected cities will be offered a subsidy of 40% on cost, or up to Rs 55 lakh per a standard bus of 10-12 metres. The incentive for a midi-bus of 8-10 metres is up to Rs 45 lakh, while for a mini electric bus, it is Rs 35 lakh.The total estimated budgetary support towards purchase of the buses is Rs 2,500 crore. India has recently approved phase-II of the FAME India Scheme (Faster Adoption and Manufacturing of Hybrid & Electric Vehicles in India), for a period of three years commencing April 1, 2019, with total budgetary support of Rs 10,000 crore.The main focus of this phase of the scheme is the electrification of public and shared transportation . The expression of interest (EoI) issued by the Department of Heavy Industries has spelt stringent timelines to be adhered to by states for securing the subsidy.The subsidy will be released in tranches with the last instalment to be given after six months of the successful operation of the buses. As per the EoI, states have to ensure completion of delivery of the buses in 12 months to avail of the subsidy.“The main intention of extending demand incentive for electric buses is to reduce the upfront capital cost of such electric buses,” the EoI said.The document showed that this time the state departments will have to call bids under the wet-lease model from companies, under which companies will own and operate the buses and quote a per-km price.While bidding, the companies will have to take into account all expenses like the purchase cost of vehicles as well as cost of operation, electricity, drivers, management of fleet, charging infrastructure , replacement of battery, maintenance of vehicle, etc. The operator who quotes the lowest rate will be the selected bidder, the document said.