In a good news for people tired of paying surge prices for cab rides across aggregator apps like Ola, Uber and Rapido, the Union transport minister on Thursday informed the Parliament of Centre’s plan to impose limits on the surge pricing during peak/office hours.
Talking about the government’s plan to battle the surge pricing wave, Gadkari also announced the initiation of testing and trial phase for the Bharat Taxi App. Launched with an aim to boost the earnings of cab drivers through a cooperative model, the Bharat Taxi App will operate under the banner of Sahahkar Taxi Cooperative Limited (STCL), Gadkari informed members of the Lok Sabha today (December 11).
New cab management business model
As per the announcement made by Gadkari earlier today, the new proposed business model will function on a driver-owned cooperative model, not a corporate-owned aggregator model. This move is supposed to draw some money away from the earnings of big aggregators and pour it into that of the drivers.
Gadkari further stated that the government has issued The Motor Vehicles Aggregators Guidelines 2025 to regulate all app-based cab services. Apart from the safeguards for the passengers, the Guidelines provide for fare regulation.
Expanding on the price limits imagined by the government, Gadkari told the lower house that the centre is planning to cap surge pricing for peak hours to twice the base amount. Where the base amount will be fixed by the state.
“The guidelines envisage dynamic pricing, allowing aggregators to charge 50 per cent lower than the state-notified base fares and capping the maximum surge pricing at twice the base fare for peak hours,” the minister said.
As per the minister, the rules are meant to create a simple, light regulatory framework that still ensures passenger safety, protects drivers’ welfare, and sets basic standards for how aggregators operate.
The competent authority for issuing licenses to such aggregators is the designated authority of the state government concerned, with jurisdiction across the entire state.
How will this impact cab drivers’ income?
According to the norms, the drivers’ owned motor vehicles will receive at least 80 per cent of the fare, and, on the other hand, for motor vehicles which are owned by the aggregator, the on-boarded driver shall receive at least 60 per cent of the fare.
“The Guidelines ensure that no passenger is charged for dead mileage, except when the distance for availing the ride is less than three kms, and the fare is charged only from the point of origin to the destination,” the minister added.
What is Bharat Taxi App?
A national app-based cab-hailing service the ‘Bharat Taxi’ will be soon launched by the government in compliance with recent motor aggregators policy and will be applicable across all states.
The National Cooperative Development Corporation (NCDC) plays a key role in establishing the cooperative-based ‘Bharat Taxi’ ride-hailing service. The new multi-state cooperative society has been registered, and driver enrolment, along with technological development, is in progress, according to an earlier statement by the government.
