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Maharashtra Caps Surge Charge For Ola, Uber To Control Fare Hike

Maharashtra Caps Surge Charge For Ola, Uber To Control Fare Hike

Cab drivers can charge a maximum of INR 44.52 per Km

The surge fare is capped at 3X the fixed fare for local taxis

The decision comes after the recommendations of BC Khatua committee

In a resolution issued on Monday (March 9), the Maharashtra government has introduced a new cap to control the surge fare of app-based cab-aggregators such as Ola and Uber.

According to a TOI report, the government has capped Ola and Uber at a maximum of 3x the fare charged by local kaali-peeli taxis. As local taxis run at a fixed fare of INR 14.84 per Km, hence Ola and Uber cannot charge their users over INR 44.52 per Km even during surge hours. Many users have complained about the rampant surge fare charged, and while 3x is definitely high, the regular fare in an Ola or Uber is usually lower or equal to the fare charged by the local taxis.

The cap in the surge fare comes after the recommendations of the BC Khatua committee. The committee was established during the previous BJP-Shiv Sena government to look into the issue of surge pricing of app-based cab aggregators, following the demands of taxi unions and passengers. It had submitted the report in September 2017.

While the resolution has already been passed in the legislative assembly, the state is not looking to take any coercive steps against Ola and Uber till April 6, 2020. It is worth noting here that the Bombay High Court is going to hear the plea filed by Ola and Uber against the City Taxi Scheme on April 6.

Besides capping the surge for Ola and Uber, the government also proposed to increase the fare of autorickshaws by INR 1 or INR 2. The hike is currently subject to approval from the Mumbai Metropolitan Region Transport Authority (MMRTA).

In the past, customers and driver-partners of Ola and Uber have raised concerns regarding surge pricing policies. In September 2019, Ashwani Mahajan, co-convenor of RSS affiliate Swadeshi Jagran Manch (SJM), had written to various union ministers such as transport minister Nitin Gadkari, finance minister Nirmala Sitharaman, and even Prime Minister Narendra Modi to take customer-centric steps for surge pricing.

The surge allowed by the Maharashtra government seems to be much higher than what the central government is formulating right now. In November 2019, the government was considering a limit on the surge price charges at 2x the base fare as per demands from customers.