#5 There should be no restrictions on the choice of the operator or aggregators with regard to composition of the fleet, i.e. deluxe and economy. & the Aggregators should get the App validated from Standardisation Testing and Quality Certification (STQC) or any other agency authorised by Ministry of Electronic and Information Technology (MEITY). Aggregators should take measures including a firewall for the security of the personal data of the passengers.

This is a welcome recommendation given the policy direction that states like Karnataka and Maharashtra are taking. Maharashtra’s rules are uniquely distortionary in this regard. Here is one example of such a rule:

Induction schedule for vehicles as given below —

(i) 25 per cent vehicles at the time of grant of licence

(ii) 50 per cent vehicles within three months from grant of licence

(iii) 75 per cent vehicles within six months from grant of licence

(iv) 100 per cent vehicles within nine months from grant of licence.

#6 The committee in the interest of last mile connectivity and cheaper mobility solutions recommends legalizing ride-sharing and allowing bike-taxis and e-rickshaws to operate.

Again, a welcome recommendation considering how many states have harassed bike-taxi trial runs. It can also help clarify the legal status of ride-sharing and thus protect it from legal challenges by the traditional taxi industry.

#7 Committee is of the opinion that the above guidelines should be applicable uniformly in the National Capital Region (NCR) so as to offer seamless connectivity to the occupants of the region.

This will not only help reduce connectivity bottlenecks in the region but also in part help reduce pollution due to vehicular emissions in the region.

How did these recommendations come about?

The report does hint at what might have happened. The Transport Commissioner of Maharashtra seems to have suggested that the rules for taxi aggregators in Maharashtra ought be considered. As alluded to earlier, Maharashtra's rules are terribly counterproductive. Their rules would render the taxi-aggregator model illegal. Thankfully, especially to the Transport Adviser to the NITI Aayog Dr Manoj Singh, such rules were prevented from entering the final list of recommendations.

The NITI Aayog’s views are detailed separately in the annexures of the report. The government think-tank is not only against the fixing of a minimum price due to concerns about such a measure promoting inspector raj and corruption, but also against any sort of limits on surge pricing. They say, “NITI AAYOG recommends that there should not be cap on the surge price, just as there is should be no lower floor price. Market competition should decide the price levels.”

The Aayog also seems to recognise the incredibly distorting nature of supply constraints in the taxi market when it says, “Taxi licenses should be given online, on the basis of pre-specified criteria for grant of license. A license should either be given within 15 days of application or it should be deemed to have been given.”

The Aayog also stresses on the need to de-regulate bus services and allow for aggregator-like bus services in Indian cities. In fact, Finance Minister Arun Jaitley had announced the government’s intent to allow states to do the same in the Union Budget of 2016. Sadly, nothing seems to have been done to implement the same. Despite ‘bus de-regulation’ not being an area of focus for the committee, we can hope to see something being done to implement the finance minister’s budget announcement in the near future.

With the committee’s report finally out, it is now up to the states to adopt these recommendations. Telangana most probably will be the first state to do so. It has been waiting for precisely this report before framing its own regulations on taxi aggregators. However, this writer is fairly sure that Karnataka won't adopt these recommendations anytime in the foreseeable future given how the existing rules, which came into force early this year, have developed a support base among traditional taxi players and one of the taxi aggregators.

It would be useful for the centre to push the National Democratic Alliance-ruled states to adopt these recommendations as quickly as possible and the Aayog to rank states on urban mobility. The faster these recommendations are adopted, the more are the benefits for the consumers.

In the past year and a half of trolling through government reports and publications on urban and transport policy issues, this writer has never come across anything as close to a sound economic policy as this. Kudos to the NITI Aayog and the Ministry of Road Transport and Highways for bringing about this welcome change.