Under the JnNURM scheme of Government of India stimulus was provided for cities having populations more than ten lacs, for bus rapid transport system or organized urban transport mechanism for cities. Government of India, Ministry of Urban Development issued directives to various states vide DO No.: K-140 11/48/2006-Ut(Pt) Dated: 12/01/2009 for “Funding for purchase of buses for Urban Transport System under JnNURM”.

To ensure a Sustainable Transport System, Government of India proposed the following reforms at state and city level.

State Level

• Setting up of a city-level Unified Metropolitan transport Authority (UMTA) for all one million plus cities, duly backed by a legislation, to facilitate coordinated planning an implementation of projects relating to urban transport and their integrated management.
• Setting up of a Dedicated Urban Transport fund at the State level.
• Change in bye-laws and Master Plan of cities to integrate land-use and transport by densification alongwith the MRTS corridors and areas around the stations.
• Nominating a single department at the state level to deal with all urban transport issues as against different departments at present.
• Setting up of a regulatory/institutional mechanism to periodically revise fares for all public and intermediate public transport systems.
• The state government and ULB waiving of /reimbursing all its taxes on urban buses & city bus service/BRTS.

City Level

• Setting up of a Dedicated Urban Transport Fund at the city level.
• An advertisement policy which taps advertisement revenue on public transport, intermediate public transport and public utilities for public purposes subject to relevant legislations.
• Parking policy wherein parking fee represents the true value of the land occupied, which is used to make public transport more attractive; banning of parking on arterial/ring roads, multi-level parking centres in City Centres with park-and-ride facility etc.
• A well organized and efficient city bus system by using ITS through city-specific SPV for bus services, preferably on PPP, under well-structured contracts where the umbrella institution of the government professionally does the role of planning, coordination, contracting, monitoring, supervision as well as management of common infrastructure and services etc.
• Multimodal integration, including suburban railways (by involving MoR) to provide network-connectivity in the region and single ticketing to provide seamless travel.
• Setting up of Traffic information Management Control Centre for effective monitoring and enforcement of traffic as well as data-generation and data-collection for future planning.

In pursuance of the above scheme, State of Uttar Pradesh got the DPRs prepared for seven cities i.e. Lucknow, Kanpur, Agra, Mathura, Allahabad, Varanasi and Meerut. Initially in the DPR 1310 buses were proposed for the above cities. The consultant M/S UMTC advised according to the city specific requirement, four types of buses to facilitate and cater the travel needs of the public in various cities. The DPR were accepted by the Government of India and the Ministry of Urban Development allocated 50 percent of the project cost (Rs.326.89 crore) by the rate of additional central assistance to the State Government and 20 percent of the rest amount was to be funded by Urban Development Department of the State whereas rest 30 percent was conceived to be borne by parastatal i.e. Development Authority, Municipal Corporation, Housing Board and Transport Department. The execution of the scheme was done by Uttar Pradesh State Road Transport Corporation.

To ensure efficient, well-coordinated, economical and sustainable Urban Transport System the nodal department, Urban Development Department, Government of Uttar Pradesh issued directives to ensure the operation of buses under the (SPV Special Purpose Vehicle) in order to give this system enough flexibility and operational independence to have a sustainable system as desired by Government of India. According to the suggestion of Government of India and recommendations in the Detailed Project Report (DPR) an apex policy framing body UMTA (Unified Metropolitan Transport Authority) was to be constituted and for the smooth functioning of SPVs the Directorate of Urban Transport was conceptualized which would also act as a Secretariat of the apex body-UMTA and oversee the issues of Urban Transport alongwith the responsibility of assessing, monitoring, controlling and distributing Viability Gap Funding to various SPV as conceived in the scheme.