The Cab-Sharing Economy game : the need of the hour

Cab-Sharing  Economy game

The cab sharing economy has emerged as an excellent adoption for the Indian consumer and cab drivers regarding providing more choices and a level playing field for both stakeholders. For example, consumers have the convenience of choosing the cab at his, or her, location and the preferred time. Similarly, the drivers can now choose their own working hours and do not need to rely on external forces to select the customer. However, recent changes in the market dynamics potentially threaten to rob both the stakeholders of the advantage.

This situation calls for industry regulators to play a proactive role in balancing the market dynamics to protect the livelihood of millions of drivers as well as to serve the interest of several millions of consumers while preserving the principles fair market play.

For example, the market is abuzz with rumors regarding the merger of OLA-UBER in India. This trend may be an extension of a phenomenon that we have witnessed globally in markets like China, Singapore, Kazakhstan, Azerbaijan, Armenia, Belarus, Indonesia, etc. where companies like DIDI, Yandex & Grab have merged with UBER. Interestingly in these markets, the supply has been altered irrevocable post the consolidation with market monopolization being the norm post mergers.

To prevent such a scenario, the following steps may be considered:

  1. Aggregator approach Govt of India may develop out with its own App (maybe service model), which could be based on SAAS model for drivers (for example, Rs. 99 per month, or 999 per annum). The revenue may be shared between the state and central govt to have better coordination, cooperation & support. The situation would be a win-win for drivers who need to pay a 25-30% as a commission to the cab aggregator companies currently.
  2. Cab tariff planning Every state has the legislative power to regulate the maximum fare a cab driver can charge from a customer. Even charges like night, waiting, the toll can be added as per timing and location. The driver may have an option to pass on more discount to the customer by changing the tariff. A model like this may provide the seller should with the power to define his price for the service it renders.
  3. An open market approach In this way, cab aggregator market monopolization may be prevented via legislation. On the other hand, regulators may collect independent ratings and reviews to enable, disable or suspend the service.
  4. Open API approach Regulators can come out with an open REST API approach so this service can be linked to other integrated service providers App like Banks, Telecom, Rail etc. This approach can potentially induce growth and reach in short span of time. The providers can also offer cashback and other such value-adds can be in near future. Initially, the aggregation may be done only to the cabs which are already providing service to Ola and Uber. This can be done via RTO after his history and track record verification. During the vehicle fitness renewal certification, a yearly subscription plan can be offered. Govt can also get a consolidated insurance policy to cover any mishap. Neither of the approaches discussed above is unique and a better solution may involve amalgamation. However, Govt can also include the GST for every transaction so that they also don’t lose over the same. The move for Digital India using UPI has shown if there is political will complemented with proper planning and implementation strategy, steps as these can go a long way in protecting the industry and the eco-system.

Akhilesh Srivastava, is CGM(IT & HO) in NHAI, working for modernization of Highway Sector and an expert on ITS (Integrated Transportation Systems), Mobility & ETC (Electronic Toll Collection). The views expressed are his personal.

Akhilesh Srivastava addressing as key speaker in Chemical & Industrial Disaster Management Conference, Gujarat 2018

Economic Advisory Council to the Prime Minister, Government of India, Petroleum and Natural Gas Regulatory Board (PNGRB), Government of India, National Disaster Management Authority, Government of India, Federation of Indian Chambers of Commerce and Industry (FICCI) and Government of Gujarat as the State Partner is organizing a Conference on Chemical & Industrial Disaster Management (CIDM), March 14-15, 2018, Convention Hall, Hyatt Regency, Ahmedabad, Gujarat. The Hon’ble Chief Minister of Gujarat is likely to inaugurate the conference.

Chemical & Industrial Disaster Management Conference

The main focus of the proposed conference and exhibition on 14-16 March 2018 would be to make industry globally safe by better emergency planning of accidents – onsite, offsite including isolated storages. The conference would also provide a platform to Indian and International companies to share their success stories, best practices and technologies to minimize accidents on production site and during transportation of chemicals, hazardous wastes and hydrocarbons. Technical sessions on Engineering, Paper, Oil & Gas, Biomedical Industries have been included in the programme.

We are expecting more than 300 delegates throughout India. Expert Presentations/ Panel Discussions on relevant topics would give an impetus to the proceedings. The Technical Committee of the conference has great pleasure and privilege in inviting you to provide a talk on ‘Transportation of Hazardous Chemicals by Road’, during Technical Session I on March 14, 2018 at Ahmedabad.

Leave a Reply

Your email address will not be published. Required fields are marked *