Buses running at intervals of five to 15 minutes will connect all parts of the city, from the Huda sectors to the Metro and railway and bus stations in the old city, as the government lines up its biggest announcement for Gurgaon to celebrate Haryana's golden jubilee: a city bus service exclusively for the Millennium City.

The Manohar Lal Khattar regime has given its approval to Greater Gurugram Urban Transport Service Limited, a special purpose vehicle (SPV) that will run the city bus service. The MCG will be at the helm of the bus service and will be a part of the SPV with a private firm that the government is yet to pick.

The city bus service is likely to start next June with a fleet of 500 buses that will run on 21 routes at 5-15-minute intervals. "Out of these 500 buses, we plan to have 175 standard non-AC buses, 175 standard AC buses, 50 midi buses, 50 mini buses and another 50 midi AC buses. The entire project is likely to cost around Rs 231 crore apart from the maintenance cost," said a senior official in Chandigarh.

The cost factor that has been delaying the bus service has also been settled. The government has recommended adoption of the gross cost contract (GCC) model, under which MCG will pay the bus operator an agreed sum (typically on a per km basis). However, keeping in view the complexity of the task involved and the limited capacity of the MCG, the state government has proposed to engage a professional agency to support the SPV and MCG in implementing this project.

The agency will be selected through a tendering process by MCG in the coming days. The chairman of the SPV will be the principal secretary of the urban local bodies department while the CEO will be the MCG commissioner.

"The agency will be responsible for day-to-day monitoring and management of the city bus service and associated contractors and operators under the overall supervision of the SPV and MCG," said the official. "The SPV is likely to get formed in the next two months and, by that time, the agency will also get selected. The time that we will need to get the supply of buses will be around eight months and we are hopeful of commencing the city bus service by June next year."

According to sources, in order to support the city bus project, the Haryana government may also consider setting up a dedicated transport fund for Gurgaon. The fund could be collected in the form of a cess like a one-time tax levied on motorised vehicles (at the state level or district level) or green tax on registration of old and new vehicles besides advertisement revenue.