In a move aimed at giving a boost to public transport, the Centre has asked all states having cities with million plus population to speed up the process of setting up a Unified Metropolitan Transport Authority (UMTA).
The Ministry of Urban Development has asked the states seeking funds under the JNNURM to set up a dedicated urban transport fund and change bye-laws and master-plans of cities to integrate land use and transport planning.
To streamline public transport, the ministry has directed the states to nominate a single department to deal with all urban transport issues efficiently.
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The states have also been asked to set up a Traffic Information Management Control Centre and to frame a parking policy.
The ministry stated that central financial assistance under the scheme will depend on the reforms undertaken by the state governments concerned.
To make public transport economically viable keeping in mind the inflationary trends, the ministry has suggested the setting up of a regulatory and institutional mechanism to periodically revise fares for all public and intermediate public transport.
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The Centre has already undertaken a series of initiatives to promote public transport, including reduction of VAT and central excise on buses initially from 16 to 12 per cent and then from 12 to 8 per cent in the second stimulus package last year.
Officials said the Urban Development ministry has asked the Finance Ministry for complete exemption of central excise duty and VAT on buses meant for urban transport subject to the state governments waiving their share of taxes to reduce the cost of buses.