Tamil Nadu’s state-run transport corporations are grappling with an additional annual financial burden of nearly Rs 175.58 crore following a recent Rs 2.86 per litre increase in high-speed diesel prices by oil marketing companies. This hike is expected to exacerbate the financial challenges faced by the public transport sector in the state. The eight state transport undertakings, including Metropolitan Transport Corporation (MTC), State Express Transport Corporation (SETC), and the six divisions of Tamil Nadu State Transport Corporation (TNSTC), collectively operate approximately 19,000 buses daily across more than 10,120 routes.
According to Transport Department Secretary Shunchonngam Jatak Chiru, the transport corporations are currently experiencing a combined daily loss of nearly Rs 19 crore. With the recent surge in diesel prices, the daily operational loss is anticipated to increase by around Rs 48.11 lakh. Officials highlight that the transport corporations spend roughly Rs 5,200 crore annually solely on diesel purchases, constituting about 26% of the total expenditure involved in running bus services.
The state-run buses play a crucial role in Tamil Nadu’s public transport network, linking nearly 98% of villages with populations exceeding 1,000. Transport workers’ unions attribute the deteriorating financial situation to the government’s reluctance to adjust bus fares in line with escalating fuel prices. The last revision of government bus fares occurred in January 2018 when diesel was priced at approximately Rs 65 per litre, which has now surged to nearly Rs 95 per litre.
Official records indicate a steady increase in the average daily loss of the transport corporations, rising from Rs 16.83 crore in 2022-23 to Rs 17.7 crore in 2023-24 and reaching Rs 18.9 crore in 2024-25. Despite these mounting losses, Tamil Nadu maintains the highest public transport ridership in the country. The average daily passenger usage has surged from 1.55 crore commuters in 2021-22 to nearly 2.05 crore in 2025-26, including approximately 70 lakh women passengers benefiting from the State government’s Vidiyal Payanam scheme, operating on 7,331 ordinary buses.
Tamil Nadu upholds one of the most economical bus fare structures in the nation, with ordinary buses charging 58 paise per kilometre and ultra deluxe buses priced at Rs 1 per kilometre. In contrast, neighboring states like Karnataka and Kerala have ordinary bus fares ranging between 75 paise and Rs 1 per kilometre, while premium services charge between Rs 1.20 and Rs 1.68 per kilometre.
