IMPROVING THE COST-EFFECTIVENESS OF STATE TRANSPORT UNDERTAKINGS

CEGIS aims to enhance the cost-efficiency of Tamil Nadu’s State Transport Undertakings (STUs), which operate the country's largest state-run bus transport network but face high average costs per kilometre. The project focuses on two key pillars: improving STU accountability by linking government support to performance indicators and expanding private bus operators' presence through a Public Sector Participation (PSP) model. CEGIS has analysed historical performance, identified sources of losses, and informed the creation of a loss funding policy. The team has also engaged with the Transport Commissioner to assess the feasibility of expanding bus coverage to new population centres, improving cost structures and service efficiency.