मैं बस में कहानी पढ़ रही हूँ, लेकिन मेरी बहन अख़बार पढ़ रही है।

Because the speaker is female.

In Hindi, the main part of the present continuous verb often shows gender:

• रहा = masculine
• रही = feminine
• रहे = plural / respectful

So:

• मैं ... पढ़ रही हूँ = I am reading (said by a female speaker)
• A male speaker would say मैं ... पढ़ रहा हूँ.

Because the auxiliary verb changes according to the subject:

• मैं ... हूँ = I am
• वह / मेरी बहन ... है = she is

So:

• मैं बस में कहानी पढ़ रही हूँ = I am reading a story on the bus
• मेरी बहन अख़बार पढ़ रही है = My sister is reading a newspaper

The रही part shows feminine gender, while हूँ / है shows who the subject is.

No. मैं just means I. It does not show gender by itself.

You only learn the speaker’s gender from other words in the sentence, especially the verb:

• मैं पढ़ रहा हूँ = male speaker
• मैं पढ़ रही हूँ = female speaker

So in this sentence, we know the speaker is female because of रही.

में is a postposition meaning in.

So:

• बस में = in the bus / on the bus

English usually says on the bus, but Hindi commonly uses में here. So even though it literally looks like in the bus, the natural meaning is on the bus.

Because Hindi uses postpositions, not prepositions.

In English, prepositions come before the noun:

• in the bus

In Hindi, the equivalent word comes after the noun:

• बस में

That is a very common pattern in Hindi:

• घर में = in the house
• स्कूल में = in school
• किताब पर = on the book

Hindi does not have articles like a, an, and the.

So:

• कहानी पढ़ रही हूँ can mean am reading a story or sometimes am reading the story, depending on context
• अख़बार पढ़ रही है can mean is reading a newspaper or is reading the newspaper

Usually the context tells you which meaning is intended.

Because मेरा / मेरी / मेरे agree with the thing possessed, not with the possessor.

Here, the possessed noun is बहन (sister), which is feminine singular. So you use:

• मेरी बहन = my sister

Compare:

• मेरा भाई = my brother
• मेरी बहन = my sister
• मेरे दोस्त = my friends / my friend (respectful or plural, depending on context)

So मेरी matches बहन, not the speaker.

Because in this kind of sentence, the verb agrees with the subject, not the object.

The subject is मेरी बहन, which is feminine, so the verb is feminine:

• मेरी बहन ... पढ़ रही है

The object is अख़बार, but it does not control the verb here.

So even though अख़बार is masculine, the sentence still uses रही because बहन is feminine.

Because not every direct object takes को in Hindi.

In sentences like this, an inanimate, non-specific direct object often appears without को:

• कहानी पढ़ रही हूँ
• अख़बार पढ़ रही है

You often see को with:

• people
• animate beings
• definite or specific objects in some contexts
• affected or emphasized objects

But with general things like a story or a newspaper, leaving out को is normal.

लेकिन means but.

It connects two contrasting ideas:

• I am reading a story on the bus
• but my sister is reading a newspaper

So लेकिन works just like but in English.

You may also hear पर or मगर for but in other contexts, but लेकिन is very common and neutral.

The normal Hindi word order is Subject–Object–Verb, so this sentence follows a very typical pattern:

• मैं = subject
• कहानी = object
• पढ़ रही हूँ = verb

Hindi word order is somewhat flexible, but changing it usually changes emphasis, not the basic meaning.

For example, बस में could move earlier or later for emphasis:

• मैं बस में कहानी पढ़ रही हूँ
• मैं कहानी बस में पढ़ रही हूँ

Both can work, but the first one sounds very natural and straightforward.

पढ़ रही हूँ is the present continuous: it means the action is happening right now.

• मैं बस में कहानी पढ़ रही हूँ = I am reading a story on the bus

पढ़ती हूँ is more like the habitual present:

• मैं बस में कहानी पढ़ती हूँ = I read stories on the bus / I usually read a story on the bus

So the sentence you were given describes an action in progress, not a habit.

• कहानी is feminine
• अख़बार is masculine

This matters when other words agree with them in some contexts. However, in this sentence, the main verb is agreeing with the subjects:

• मैं implied female
• मेरी बहन feminine

So even though the objects have different genders, both verb forms are still पढ़ रही because both subjects are feminine.

ख़ is ख with a dot, called a nukta. It usually represents a sound borrowed from Persian/Arabic, something like a stronger or rougher kh sound.

So अख़बार is pronounced roughly like akh-baar.

In everyday speech, many speakers pronounce ख़ very similarly to plain ख, so do not worry too much if you cannot hear or produce a strong difference at first.