Gujarat government plans to cap Uber, Ola fleet at 20,000 The Gujarat government is considering a proposal to limit the number of cabs run by app-based aggregators in the state at 20,000 each, a move that could impact Uber, Ola and their rivals if implemented and be the first time that such a cap is put in place anywhere in India. A state official said the proposition was prompted by public safety and other concerns.

“The aggregator shall not attach more than 20,000 vehicles under one licence and only one licence shall be issued to a company or an aggregator,” according to the draft issued by the Posts and Transport Department of .

Uber said it would work with the state government on the matter. “We remain committed to engaging the government and working with relevant authorities to regulations that can enhance the future of urban mobility in Gujarat’s mega cities,” an Uber spokesperson said. “Uber will continue to work together with the local administration to determine how we can contribute towards bringing smart mobility and ridesharing solutions to help curb congestion and last-mile problems in Gujarat.”

declined to comment. Similar moves are underway globally as cities seek to rein in the explosion in such cabs that have taken away business from traditional taxis and clogged roads. Transport authorities and governments have also complained that drivers of such cabs are not properly vetted, leading to attacks on passengers.

Uber, which began services in 2011, currently operates in more than 600 cities around the globe. Bengaluru-based Ola, which is reportedly set to raise its latest round of funding at a valuation of $7-8 billion, has also entered Australia and the . The number of such cabs in Gujarat’s top four cities is pegged at 8,000-10,000, according to government and sources.

A senior Gujarat government official involved in putting the draft together said safety issues, including attacks on passengers elsewhere in India, had prompted the transport department to come up with the proposals.

“Currently, it is just a draft as we seek to regulate taxi aggregators and we will evaluate suggestions and objections from stakeholders before finalising it,” he said, asking not to be named as he is not authorised to speak to the media. “Our main attempt is to regulate this kind of service so that Ola and Uber would come under the net of rules and to bind them with conditions of the licences and make them follow the rules.”

The draft Gujarat State on Demand Transportation Aggregator Rules, , allows the department to suspend or even cancel licences if operators fail to comply with rules.

The licensing authority can also suspend permits for 10 days to six months or cancel them if “any driver of a taxi operated by the licensee violates any requirement or condition of the rules or a passenger complaint of misbehaviour and misdemeanour on the part of the driver or the licensee.”

Those seeking to operate more than 10,000 cabs, with the upper limit at 20,000, can get licences by paying a fee of Rs 10 lakh and a security deposit of Rs 25 lakh, according to the proposal. Indian states are seeking to arrive at comprehensive legislation to regulate mobile application-based cab aggregators. In May, thousands of Ola and Uber drivers went on strike for days after the ride-hailing companies cut incentives for drivers.

In August, after protests by traditional yellow cabs drivers, New York said it planned to cap the number of licences for app-based cabs for a year and to fix minimum wages for drivers plying through ride-hailing companies like Uber and Lyft. It’s the first large US city to impose such curbs. Protests have intensified as ride-hailing cabs have come to outnumber yellow cabs by almost six to one in New York.

On Monday, a working group in the UK’s Department for Transport submitted a report urging the government to cap the number of licences for such cabs in London and other large UK cities.

“Government should legislate to allow local licensing authorities, where a need is proven through a public interest test, to set a cap on the number of taxi and PHVs (private hire vehicles) they license,” the Task and Finish Group on Taxi and Private Hire Vehicle Licensing said in the report.

“This can help authorities to solve challenges around congestion, air quality and parking and ensure appropriate provision of taxi and private hire services for passengers, while maintaining drivers’ working conditions.”



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