Is Delhi preparing to ban Ola and Uber from offering shared rides?

In September last year, the Aam Aadmi Party government told the Delhi High Court it was finalising a regulatory framework for taxis plying in the National Capital Region. Called the City Taxi Scheme 2017, it was supposed to be notified by the end of last year. That did not happen.

This delay has only served to intensify speculation that the scheme seeks to ban the service of shared rides offered by app-based taxi services such as Uber and Ola.

The latest draft of the scheme was submitted to Transport Minister Kailash Gahlot in December, senior officials in the Delhi transport department said. A list of suggestions submitted along with the draft, the officials added, calls for allowing cab services such as Ola and Uber to continue offering shared rides but only if they tweak their mobile apps to make them more compliant with provisions of the Motor Vehicles Act, 1988. Primarily, the cab operators would have to add certain “safety features” such as sharing their GPS logs with the state government and the Delhi police, which is under the central government, and ensuring their cabs are approved by the regional transport offices of all states they ply in within the National Capital Region – Delhi, Uttar Pradesh, Haryana and Rajasthan. The scheme also seeks to leave it to the passenger whether she wants to share the ride or not.

“The Motor Vehicles Act does not have provisions for shared rides offered by cabs,” said a senior official in the Delhi transport department. “This fact was mentioned in the scheme and we suggested that the cab aggregators should make some changes to their mobile applications to adhere to the law.”

Buzz about ban

It was in February 2017 that speculation first began about an impending ban on shared rides in Delhi, with a series of reports quoting unidentified officials as saying the cab aggregators were violating their permit conditions under the Motor Vehicles Act by offering such services. Delhi was apparently following the lead of Karnataka, which had just banned Ola and Uber from offering shared rides in Bangalore. Though Karnataka withdrew its ban only a few weeks later, the Delhi government has continued to pursue the proposal.

The reason offered by the Delhi government for the proposed ban is the same as Karnataka’s: app-based cab aggregators operate under the Contract Carriage Permit, which only allows “point-to-point transportation” without any stopover between where the ride starts and the destination. Basically, the transport department official explained, a taxi service provider cannot charge multiple passengers for a common ride. Only vehicles with the Stage Carriage Permit, such as public buses, can do so. The Stage Carriage Permit is not feasible for taxis since it would restrict the routes they can ply on even within a city, just like city buses which have specific routes and timings.

“So we suggested a way out,” the official explained. “A passenger pays the full fare for a ride and she gets to decide whether or not to share the ride. If she chooses to do so, the next passenger in pays the first passenger instead of the cab driver. This transaction between passengers who agree to share a ride has to be enabled virtually through the mobile apps which already offer payment through e-wallets.”

Beyond this procedural problem, though, Arvind Kejriwal said last month, cab sharing is a good idea. The Delhi chief minister added that his government was discussing the matter, but did not say anything about introducing the City Taxi Scheme 2017. A PTI report, quoting unnamed sources, later said Gahlot would take the final call on the matter on December 7, but that did not happen.

Tweaking the apps

As for the cab aggregators sharing their GPS logs with the state government and the police, the transport official said it would help ensure the safety of women passengers. The Delhi police maintains a women’s safety app called Himmat, and the idea is to have the cab operators share their logs with this app.

“The scheme also says no taxi registered in any other state of the National Capital Region will be allowed in Delhi unless it is party to a reciprocal agreement endorsed by the regional transport office in Delhi and vice-versa,” the official added. Simply, a cab registered in Haryana must also be approved by the regional office in Delhi and vice versa. This would require cab operators such as Ola and Uber to create a system whereby rides demanding travel from one state to another within the National Capital Region are only assigned to cabs approved by the transport offices of both states. “It is an accountability issue which can bring safeguard in terms of security,” the official said.

The official, however, underlined that “the final call” on all these matters “will be the minister’s”. “We can end up officially saying something and land in an awkward position with the minister contradicting what we had said,” he said. “But it is high time for the scheme to be notified.”