Ola ban: Karnataka minister comes to rescue, lifts six-month suspension

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Updated: March 24, 2019 3:43:12 PM

Karnataka's social welfare minister Priyank Kharge today announced lifting the six-month ban on SoftBank-backed Ola, imposed by the transport department for its bike taxi service. Ola’s arch-rival Uber had stopped its bike taxi service UberMOTO in Bengaluru around two months after launching it in March 2016.

There is an urgent need for policies to catch-up with new technologies & also industries too should work closer with Govt to help evolve policies for innovations, said Kharge.

Just two days after the Karnataka transport department imposed a six-month ban on SoftBank-backed ride hailing company Ola for non-compliance of licence norms with respect to its bike taxis plying in Bengaluru, the state’s social welfare minister Priyank Kharge today announced lifting the ban, giving a breather to Ola to comply with regulations.

The minister tweeted revoking of the ban.

The early action by the government was also acknowledged by the members of the startup ecosystem underlining its impact on boosting the growth of the ecosystem.

“This speed of resolution is much appreciated and augurs well for the new India! Great to see younger ministers shedding the ways of the older ones and promoting speed and innovation,” tweeted Matrix Partners India Managing Director and one of Ola’s early backers Avnish Bajaj.

“Fantastic! This is the right approach to accelerate the country into the future!,” tweeted Aprameya Radhakrishna, former Co-founder at ride hailing app TaxiForSure. Ola had acquired TaxiForSure in 2015 for $200 million.

Ola, however, hasn’t come out with an official statement for the ban lifted. Ola had called the ban notification sent by the department “unfortunate” and had claimed that it halted the bike taxi service weeks ago and instead had asked the government for a legal framework around it.

“Despite other companies continuing to operate illegally, Ola halted our bike taxi experiment weeks ago, instead seeking the state’s cooperation to develop a legal framework for a pilot that will continue to take advantage of emerging opportunities in the mobility economy,” the company said in a statement.

The department enforced ban after Ola failed to comply with the licence regulations pertaining to its bike taxis.

According to the transport department, Ola was issued licence only to operate app-based cab service while the bike taxis were never permitted.

“Two-wheeler operations are not in their scope. Bike taxis are not included in their licence. They (Ola) can operate only cabs. Karnataka doesn’t have provision to operate bike taxis. This is not the first time. They are repeatedly doing this,” a senior official at the Karnataka transport department had told Financial Express Online.

In February, several bike taxis operated by Ola and smaller rival Rapido were reportedly impounded in Bengaluru.

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