The Association of Radio Taxis (AoRT), which includes companies like Mega Cabs, Easy Cabs and Meru Cabs, has made recommendations to the Ministry of Road Transport and Highways (MoRTH) to take into account its point of view for regulations of online cab and taxi aggregators. MediaNama has reviewed the letter and listed out the suggestions below. Copies of these recommendations are also cc’d to the state transport ministers in Mumbai, New Delhi, Hyderabad and Bhopal and the Special Committee of the Delhi High Court.

Their suggestions are:

1. One business and one law in a city: The regulation for radio taxi companies, black and yellow taxi providers and aggregators should be the same since they all serve the same purpose of ‘point-to-point’ cab service to the same set of passengers using similar tech and processes. The regulations should take into account all stakeholders like the customers, drivers, radio taxi companies and aggregators etc.

2. Fare regulations: “Range bound competitive fare” is absolutely necessary because-
– taxis come under the public transportation system which is for the public good,
– there’s a duopoly in the market with two players commanding a 90% share and
– true marketplace model and market driven pricing can only exist when a ‘large set of individual drivers decide the prices’ which are currently decided by 2-3 aggregators
– open the fare up through a minimum and maximum tariff range for various categories based on engine capacity
– aggregators are not a part of regulations unlike radio taxi companies. “There should be parity and consistency through introduction of similar rules among all city taxis.”

3. Strict rules against predatory pricing: The AoRT states that the two companies are indulging in predatory pricing and paying their drivers through subsidies, given their operating cash losses are at Rs 6,000-7,000 crore yearly. Citing China’s example, it said that predatory pricing resulted in duopoly which again was converted to a monopoly, threatening the existence of the ecosystem.

4. A progressive regulation will include:
– Minimum fare not lower than indirect or direct cost
– No aggregator/marketplace should be allowed to sell below that cost
– There should be an upper limit on the fare to protect consumer interest
– Transparency in the formula based on upper and lower limits which can be revised and reversed once a year

5. Change in taxi categorisation


6. All India tourist permits: Tourist taxis should not be used for point to point intra-city transportation. (Tourist taxis need to have electronic meters and charge government regulated fares. The MoRTH is working on guidelines for All India tourist permits, more here.)

7. Fuel type: Whenever available, the policy should promote CNG use among all taxis. City taxis should comply with fuel type and emission standards by the state’s transport department.

8. Public Service Vehicle (PSV) badge: PSV Badge and state domicile should be uniform between all taxi types.

9. Hardware requirements: Digital fare meter, where GPS embedded smartphone apps for all other taxi types including street hail taxis. Taxi sign on the top of the vehicle for aggregator companies. (Since aggregators do not have taxi tops, it should not be compulsory for other taxi operators.)

The AORT states that rules for online cab aggregators should not be different from the ones for radio taxi operators merely “on the basis of the method of booking a cab” because essentially, they’re ferrying passengers from point A to B. It concludes, “Different set of rules for the same taxi service would violate the principle of equality of law as proclaimed by Article 14 of the Constitution of India.”

Image credit: Damian Moore under CC BY SA 2.0