The curious case of bus aggregators and policy makers, and their unending tussle

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Daily commute has become an everyday hell for many city-dwellers in Bengaluru, Delhi, Mumbai and beyond. Lack of reliable and quality public transport and growing traffic congestion are just some of the problems residents face every day.

The launch of a slew of startups in the vehicle aggregation space, from taxis to buses and bikes, was expected to help the common man get access to relatively cheap, safe and reliable transport options. But run-ins with authorities in different cities has halted developments on that front. This is especially true in the space of bus aggregation, which would have helped the most number of people.



In fact, it is only in the taxi aggregation space, the most expensive mode of transport of the lot, that companies like Ola and Uber have tasted success. The Road Safety Bill, currently under review in Parliament, is expected to be more accommodating towards startups in the sector, sources say.  But when that Bill will become a reality only time will tell.

Meanwhile, headaches for players like Shuttl and ZipGo continue. The Bengaluru Regional Transport Office (RTO) has again put a roadblock to bus aggregator ZipGo's services. In December last year, Gurgaon-based Shuttl faced similar run-ins with the law.

An economic survey suggests that during 2014-15 the vehicular population in Delhi touched 88.27 lakh. The year 2015 saw 59 lakh new vehicles entering Bengaluru. While citizens have the option of a well-functioning Metro service in Delhi, the delay in completion in Bengaluru's is affecting commuters badly.

More lacks than not

Additional Commissioner for Transport and Secretary, State Transport Authority, Karnataka H G Kumar admits, “An odd-even rule like the one piloted in Delhi will put a lot of hardship on the public in Bengaluru, if tried. Public transport should be good enough to introduce this rule in a city. But we have no [efficient] metro unlike, or enough services from the BMTC.Due to lack of [efficient] public transport, we arehesitating to adapt this system.”

And yet the aggregators seem to face problems with the State authorities, and have even had to shut operations. In December last year, around 20 vehicles operated by Shuttl and Ola had been seized for violation. Ola Shuttle service currently runs on 100 routes across Delhi-NCR and ferries over 10,000 consumers daily. The company has over 500 shuttles on its platform. The services include 4G, Wi-Fi, on-demand entertainment, real-time GPS tracking, reserved push-back seating and cashless payments through Ola Money.

It has also launched ‘Suggest a Route’ feature on its app in Delhi-NCR, to let users suggest routes. These moves primarily identify areas where there is a strong need for commute options so that the company can roll-out shuttle services accordingly.

Law or lawlessness

Shuttl, on the other hand, completed one million rides across Delhi-NCR in just 194 days of its operations. It claims to reduce traffic by 4,500 vehicles every day, and to have halved 53,460 tonnes carbon emissions till date.

Amit Singh, CEO, Shuttl, says, “The public has embraced Shuttl beyond our expectations and the kind of growth we have achieved is remarkable. While we are excited about our performance to date, there is much to be done in the coming months.”

Shuttl and Ola Shuttle services were halted in Gurgaon last year. According to Regional Transportation Authority Office, Gurgaon, shuttle services can’t operate in the city as they don’t fall in the ambit of the Haryana Contract Carriage Permit Act 1988, 1993, 2001, 2004, and 2013.

Bharat Bhushan, Assistant Secretary at the RTA, had said:

"Ola and Shuttl have got licence to operate under the Stage Contract Act, which is valid for intercity travel (without multiple stops in city limits). But they can ply in the city limits (intra-city) only under Contract Carriage Act [licence]. This is illegal and we have started penalising them."

No parallel services

Jitender Sharma, Founder and CEO, ZipGo, says his company is an app-based aggregator, just like Uber and Ola. All vehicles attached to ZipGo platform carry valid Contract Carriage permits and other required documents, like registration certificate, road tax receipt, insurance receipt, pollution under control certificate and vehicle fitness certificate, he adds.

"Simply put, ZipGo and all the vehicles leveraging the ZipGo platform comply with all the regulations and laws, most specifically Section 2(7) of the Motor Vehicles Act that deals with Contract Carriage Permits," Jitender explains.

However, H G Kumar says: “Those who are soliciting or canvassing customers in vehicles should take a licence for the same. Any company can take permit under Contract Carriage but it allows only transport from one point to another; you can’t pick up or drop passengers en route.” According to him, connecting passengers and drivers through web-based app makes them solicitors. Since they charge for the service, they must take the Contract Carriage licence, as per Section 93 of Indian Motor Vehicle Act.

In Bengaluru, no service parallel to Bangalore Metropolitan Transport Corporation (BMTC) is allowed; pick up and drop en route is a prerogative reserved for the State service.

The fighting customer

Ironically, this battle between state and private players doesn't seem to help the end consumer. People in Bengaluru are still stuck in traffic jams and there is no clarity whatsoever.

A consumer says, "There is no metro in Bengaluru, the buses are infrequent. Most buses are overcrowded and have people literally hanging along the railings. I am not sure if even that is legal, but at least with these bus aggregator services I have been able to avoid driving and adding to the congestion. The buses are clean, drivers drive the vehicle safely and the timings are maintained.”

While authorities agree that the delay in construction of Metro Rail network calls for more intra-city transport buses, there has been no initiative for a survey from the government so far to find out how many more buses are needed.

To Bill or not to Bill

A few weeks ago, Union Minister for Roads and Highways Nitin Gadkari had stated that the Road Safety Bill will be passed in the upcoming Budget Session.

H G Kumar says that once the Bill is cleared, there will be tough competition between Karnataka State Road Transport Corporation (KSRTC) and private operators. “The central government scheme promises to protect State services like KSRTC. But the rest of the space will be given to big parties who have the capacity to run the service,” he adds. According to him, each chapter of the Bill will be rewritten, with enormous changes being introduced in the Motor Vehicles Act. However, even once the Bill is passed, the amendments will take some time.

YourStory take

On the one hand, authorities encourage carpooling, and on the other, they put a spoke to services like ZipGo which are working to solve the problem of traffic congestion. Despite its Metro, Delhi's odd-even rule will make commuters dependent on other services like Shuttl's.

Vehicle aggregators’ run-in with law is not new. Cab aggregators like Ola, Uber and TaxiForSure (before its acquisition) too had faced the heat from the government. Many of their vehicles were seized due to similar issues related to licences.

But by October 2015, the Central Ministry of Road Transport and Highways issued ‘Advisory for Licensing, Compliance and Liability of On-demand Information Technology based Transportation platforms’ providing relief to these players.

Hopefully, a similar restructuring of laws will soon give some relief to both bus aggregators and daily commuters. It is ultimately not in taxpayer's best interest for the government to continue laying obstacles to services that will contribute to reducing traffic congestion in our metros.

The number of vehicles will just keep increasing and, for Bengaluru, Metro construction and dearth of BMTC’s funds will lead to more traffic hassles. Wouldn't it work in the benefit of all if everyone work hand-in-hand?

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