The accelerated pace of urbanisation in the country, together with a rise in disposable incomes of our burgeoning middle-class and occupational shifts of urban dwellers towards industry and service sectors, has increased the demands of mobility and travel. This imposes a severe strain on our urban transport infrastructure. Not surprisingly, our urban roads are experiencing intense traffic congestion?a serious limitation in most Indian metros.
Doubtless, traffic congestion is a festering sore on the economy, calling for remedial measures. But is the levy of a congestion cess the right therapy? No doubt, international experience shows that countries like London and Singapore have taken recourse to congestion charging schemes that could later be used to fund their public transport network and thereby alleviate traffic congestion. Yet, it would be premature to emulate this experience in our country. And for good reason.
Unlike developed countries, which have a basic transport network in place, metros in India have no strong backbone of public transport to fall back on. Our system is characterised by gross inadequacy of mass public transport, both in terms of quality and quantity, which could cater to rising travel demand. In fact, in a city like Delhi, it is estimated that buses form less than 1% of total transport vehicles but is required to meet 50% of travel demand. The shortfall has to be met by a preponderance of personalised transport vehicles such as two-wheelers and cars. Not surprisingly, private vehicle use is rising and so is congestion on the roads.
Secondly, in a rapidly urbanising developing country like ours, where most of urban travel is related to education and employment, there is only a remote possibility that the imposition of a cess would reduce the average number of trips made per person a day Hence, a cess on private vehicles would only add to commuter woes and result in further chaos on the road. At the same time, past experience also does not evoke much confidence that the money raised by a dedicated cess would be ploughed back to improve the public transport systems in metros.
Besides, according to a working group of the Planning Commission, unlike in the west, there is no Indian city with a defined central business district that attracts mass travel; most are growing in a dispersed manner, requiring transport for different routes. Such realities should be factored in before considering the imposition of a congestion cess. Furthermore, at this juncture, would it be appropriate to curb aggregate demand for automobiles, which has contributed significantly to industrial resurgence and has emerged as a driver for investment, technology and employment with such a cess?
A better option would be to address the current mismatch between demand and supply of public transport, through a hierarchical system that would dissuade private vehicles from hitting the road. Indeed, experience shows that vehicle owners will use mass public transport if a good one is available; commuters prefer public to private mode of travel, as it eases the hassle of finding parking and being stuck in traffic snarls.
The mass transport system would use different modes that are fully integrated to cater to trips of different length?with a rail based system (like metro and commuter rail) for long distance travel, with shorter trips catered to by bus transport. Public transport should be made more attractive by augmenting capacity, improving reliability and making travel accessible. No doubt, mass transportation systems do exist in Indian metros. Both Delhi and Kolkata boast a modern metro service, which complements buses for public travel. But these systems operate in isolation from one another and under different authorities with no coordination.
The prevailing traffic woes could also be mitigated through effective traffic management through use of information technology. In this context, the use of an integrated intelligent transport system deserves special mention. Technology could be used to track traffic and also disseminate traffic information, thereby dramatically improving efficiency in managing travel demand.
Only after viable mass transport and traffic management technology is in place should the introduction of a cess be considered. In the absence of an efficient mass transport system, the levy would not be a deterrent, as citizens would purchase and use private vehicles anyway.
?The writer is an economist with the PHD Chambers of Commerce & Industry