Electric buses for capital: Tk2,500cr to be spent in 2 years

Infograph: TBS

Highlights:

• Government plans 400 electric buses to fight Dhaka's pollution
• Buses leased to private operators through open tenders
• Policy, infrastructure gaps threaten electric vehicle success
• Previous electric bus projects failed due to poor planning
• High EV import taxes discourage private investment and adoption
• Dhaka's severe air pollution urgently needs cleaner transport solutions

The government is embarking on an ambitious Tk2,500 crore World Bank-funded initiative to deploy 400 electric buses in Dhaka, a critical step towards combating the choking air pollution that plagues one of the world's most contaminated capitals. The move aims to replace the city's ageing, diesel-powered bus fleet, which currently dominates public transport.

The project, spearheaded by the Dhaka Transport Coordination Authority (DTCA), will see state-owned IDCOL manage the assets. The new electric buses will be leased to private operators, who will be selected through open tenders. This approach is designed to circumvent the inefficiencies and politicisation that have hampered previous public transport schemes.

"We've already secured clearance from the Planning Commission and anticipate approval from Ecnec within the next few weeks," stated Dhrubo Alam, DTCA's Deputy Transport Planner and Project Director. "Once approved, the buses are expected to be on the roads within two years of the project's five-year timeline."

Initial plans include two charging depots – one in Purbachal and another in Kanchpur – with the buses operating on two or three city routes.

Policy hurdles loom for electric bus rollout

While the initiative appears promising on paper, the path to widespread electric mobility in Bangladesh is fraught with policy challenges. 

Experts caution that simply introducing a fleet of electric buses will not be enough. Comprehensive reforms in transport policy, incentives for operators, and a robust power infrastructure for EV charging are essential to prevent this high-cost experiment from becoming another missed opportunity.

A new push after past failures

This ambitious plan follows a series of abandoned electric vehicle (EV) initiatives in Bangladesh. A previous project for electric buses within the Bus Rapid Transit (BRT) system failed due to depot design flaws. Similarly, a plan to import 150 electric buses from India for the Bangladesh Road Transport Corporation (BRTC) never materialised. BRTC is currently attempting to procure a mere 12 electric buses.

However, Shitanshu Kumar Biswas, Director of BRT, believes the interim government is taking this latest effort seriously, bolstered by World Bank support and improved planning.

"Bangladesh not serious about EVs," experts warn

Despite the new initiative, transport experts argue that Bangladesh still lacks a strong, EV-friendly policy framework. 

Professor Shamsul Haque, a transport expert from BUET, criticised the government for continuing to incentivise fossil fuel-based vehicles over cleaner alternatives.

"The worst pollution stems from diesel-run commercial vehicles," Professor Haque told The Business Standard. "While countries like China and Vietnam have made EV adoption in public transport a national priority, Bangladesh remains far behind."

He noted that although this year's budget finally extended production benefits to electric vehicles, including three-wheelers – a privilege previously exclusive to fossil fuel vehicles – the decision was long overdue and should have been prioritised earlier.

"Simply buying a few EVs for government use won't transform the market. Policies must be in place to enable the private sector to see profits in green mobility," he asserted.

Import tariff disparities undermine progress

Professor Haque highlighted Bangladesh's import tax policies as a significant deterrent to EV adoption. Diesel-run buses face import duties of 15–37%, whereas electric buses are subject to taxes exceeding 58%.

"Why would any entrepreneur import electric buses at such a high cost?" he questioned. "From import and registration to charging infrastructure – EVs need to be favoured over fossil fuels at every step." 

He warned that the government's target of 30% EV adoption by 2030 is unattainable without urgent policy adjustments.

Local industry ready, awaiting incentives

Despite policy hurdles, Bangladesh's automotive sector shows readiness for EV production. 

Mir Masud Kabir, Managing Director of Bangladesh Auto Industries Ltd, confirmed that his company has developed multiple light commercial EV models at its Mirer Sarai factory and plans to establish a nationwide EV charging network.

Professor Haque drew a parallel to the early days of CNG three-wheelers. Initially, government support was limited to a few refuelling stations, but as the business case became clear, the private sector rapidly expanded the network. 

"Electric vehicles can follow the same path – but only if the private sector is given the right incentives," he concluded.

Dhaka's dire air pollution crisis

Bangladesh faces a severe air pollution crisis, with devastating impacts on public health, productivity, and overall welfare, according to a World Bank appraisal of the Bangladesh Clean Air Project. 

The report notes that Bangladesh is part of the Indo-Gangetic Plain and Himalayan Foothills (IGP-HF) region, identified as a global air pollution hotspot. Annual average concentrations of fine particulate matter (PM2.5) – the pollutant with the most severe health impact – range between 60 and 100 micrograms per cubic meter (μg/m3) nationwide, and 90–100 μg/m3 in Dhaka alone. These levels are 10 to 20 times higher than the World Health Organization's air quality guideline.

In 2019, PM2.5 exposure resulted in over 159,000 premature deaths and 2.5 billion days of illness in Bangladesh, with health-related costs equivalent to 8.3% of the country's GDP. The most vulnerable populations, including the poor, women, the elderly, and children under five, are disproportionately affected.

Beyond health, air pollution is eroding the liveability and competitiveness of Bangladeshi cities, particularly Dhaka, which consistently ranks among the most polluted cities globally throughout the year, not just in winter. 

Experts caution that without a rapid shift to cleaner transport, the country's air quality will further deteriorate, exacerbating its public health and environmental challenges.

To address this crisis, the $355 million Bangladesh Clean Air Project, backed by $290 million in World Bank financing, is set to be implemented between 2025 and 2030. The project, led by the Bangladesh Road Transport Authority (BRTA), DTCA, and the Department of Environment, aims to strengthen air quality management systems and cut emissions from the transport sector.