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With ever-increasing rise in inflation, fuel costs and taxation, we endeavour to design and fabricate a fuel-efficient bike, which is of low cost and high efficiency. It is proposed to overcome the drawbacks of existing electric bikes, which are currently available in the market. Our proposal `The Hybrid Bike with 3 speed transmission system' is an electromechanical system which consists of two phases. In the first phase, it works as an electric bike which is eco friendly and in the second phase it works on an IC engine. The second phase is used only when the battery is discharged completely and during high speed application.