Carpooling — What does the law say?
By: Ola Mobility Institute
Tags: Mobility, Urban Mobility, Transport, Carpooling, Shared Mobility

by Jagriti Arora

This is Part 2 of a three part story on Carpooling — intuitively is a silver bullet solution to India’s mobility woes, yet without an at-scale organised market. Part 1 set the here-and-now importance of Carpooling, Part 2 looks at the current legislative barriers and Part 3 tries to draw experience from other countries.

With Indian cities struggling with pollution and congestion, they might benefit from people sharing a ride. The previous article in the series established that not only does carpooling ease congestion and emissions, it also enables the utilisation of existing cars and reduction of monthly expenses for commuters. One might wonder, “if carpooling is so beneficial, why isn’t it incentivized?”. The short answer — legally, carpooling lies in a grey area.

The relevant regulation for Carpooling in India is the Motor Vehicles Act, 1988 (MVA). According the MVA only Contract Carriages and Public Service Vehicles under the relevant licence can carry passengers for ‘hire and reward’. By definition, Contract Carriages and Public Service Vehicles excludes ‘a private car which is only used occasionally for the giving of lifts against some payment’. However private car providing occasional lifts against a payment which only sets off the cost of a trip is not really vehicle in which passengers are carried for ‘hire or reward’. This vagueness in definition of what constitutes “hire or reward” makes carpooling grey.

Clearly, for cities to fully benefit from carpooling, it needs to be adopted at larger scale for which an enabling regulatory environment is required. But policymakers are wary of carpooling operations turning into a full-time taxi service. A glimpse of possible governance risks associated with ride-sharing may reveal the way-forward for governments to preemptively address the various associated challenges. Firstly, privacy is a concern for users because the operation of ad-hoc businesses involves the collection of sensitive data such as telephone number, geolocation data, credit, and debit card details. Secondly, safety accounts for a primary concern among the riders since the ridesharing drivers are not professionally trained or vetted like taxi drivers. Moreover, private vehicle owners’ motivation to earn may overpower their prudence for vehicle fitness. This creates a difficult situation for private owners in case of accidents because accidents become a sole liability of the private vehicle owner. Thirdly, some passengers may delay the entire trip due to their unpunctual nature.

However, there does seem to be some movement on part of the Government to institute measures for organised Carpooling. Moving Together Forward, a report by Niti Aayog, launched at the MOVE summit, revealed a political will to implement carpooling in India. The report defined ride-sharing as “ An arrangement in which trips are shared by travelers, but with the exception that drivers are not considered “for-hire,” though they can receive some forms of compensation to recover their cost”.

What can be some measures that India can adopt? Read Part 3 of this series.