In the light of Karnataka’s move to cap fares of taxi-hailing firms and end surge pricing, Nandan Nilekani, ex-chairman of the Unique Identification Authority of India & co-founder of Infosys, said India lacks disruption in the field of transportation due to the absence of a national regulator.
“For transportation, the (current) regulator is the state and the moment a state is a regulator, each of them will have a different thing. Like Bangalore (Karnataka) says no surge pricing on Uber, but it will have a very small impact,” Nilekani at in his address at iSpirt’s InTech50 event in Bengaluru on Wednesday.
According to Nilekani, the three most disruptive regulators in India are the Reserve Bank of India for banking, the Securities and Exchange Board of India for mutual funds, and the Telecom Regulatory Authority of India for telecommunications, all of whom are national regulators.
Karnataka last week became the first state to roll out a formal set of rules for app-based taxi aggregators such as Uber and Ola. The state has mandated that all taxi hailing services register with the local transport authority, stick to prescribed fares and install digital metres in taxis.
The move will hurt companies
such as Uber and Ola which between the two of them have pledged to invest Rs 2.25 billion to grow their services in India. Uber, which is contesting the state’s decision, says contrary to popular belief, its surge pricing practice helps match demand with supply and that a cap on fares could mean people would pay 30% more for trips on average.