Delhi readies policy to fix tariff ceiling for Uber, Ola

NEW DELHI: Mobile app-based taxi aggregators in the capital including Ola and Uber are set to face a cap on fares they can charge customers once a new policy by the Aam Aadmi Party government in Delhi is approved.

Transport minister Satyendar Jain confirmed that the policy has been drafted and may be placed in the public domain “in two-three days” for feedback. “The draft is ready. Soon, it will be put up for public consultation,” Jain told a group of reporters in an offcamera briefing on Wednesday.


Explaining how the tariff and method of charging will be regulated, Jain said, “We have said meters should be there.Tariff will be what the government fixes, though it will be dynamic. They (aggregators) won’t be able to impose surge pricing.”

The government is strengthening efforts to regulate cab aggregators in the interests of passengers by checking exorbitant fares and improving safety norms.

Uber and Ola, the biggest two taxi aggregators in the country, have cut into the market share of black-and-yellow taxis and auto-rickshaws. ET had reported in April that the AAP government planned to impose a price band on tariffs charged by taxi aggregators in the national capital.

However, Jain said there would be no floor for fares because setting a ceiling would automatically limit the scope for reductions by the aggregators. “They play a game with you – sometimes charging you more and at other times less. We are fixing maximum (tariff) now and they won’t be able to charge beyond that. (This maximum) tariff will depend upon the vehicle (which will be used),” the minister said.

Uber suspended surge pricing in Delhi after the government said it would cancel permits and impound vehicles. It earlier defended surge pricing when demand for cabs – notably during the AAP government’s odd-even scheme – exceeded supply.

Jain’s comments on Wednesday came after the Delhi High Court recently directed the government to form a policy for taxi aggregators. However, it’s not immediately clear how the proposed policy will be implemented.

According to Jain, the government will decide on a course of action based on the court’s directions. The government could either release the policy for feedback from stakeholders or send it to a HC-appointed committee to peruse and then take the next steps. Jain said the policy will be favourable towards all stakeholders and is in keeping with the Centre’s directions to states to formulate policies for aggregators.

“Kerala and other states have also done this (draft policy). Everybody (taxi aggregators) will have the facility of registering with the government. Policy is ready from our end,” Jain said.

Earlier this month, ET reported that the Ministry of Road Transport and Highways will let states decide whether fares should be calculated using the Global Positioning System – which aggregators currently use – or digital meters. Jain confirmed that the Delhi government is in favour of meters.