OPEN LETTER

A frustrated Delhiite to Kejriwal: I like you, but you really screwed it up with surge pricing

Quartz india
Quartz india

Dear Mr. Kejriwal,

I am writing to you today as a person whose life and daily commuting options have been made much simpler and cheaper due to advancement of technology. I am an Aam Admi—the ilk you represent. I appreciate your government’s efforts to make Delhi a better place to live in. I have witnessed sweeping and positive changes in the way your government is delivering services to its citizens.

However, delivery of services is not the exclusive domain of the government. If six decades of licence raj has taught us anything, it is that the government needs to provide adequate space to efficient private sector players for delivery of services in order to facilitate economic growth. To this end, the role of a government should be restricted to avoiding or acting upon instances of unethical business practices.

Your government’s move against taxi aggregators’ surge pricing model doesn’t fall in this line, and is bound to make life harder for the common man. As someone with a fair bit of exposure to transport planning and who is familiar with Delhi’s transport options, I argue that the current transport infrastructure is ill-equipped to handle the demand.

It is in this space that technology players such as Ola and Uber have brought efficiencies that were unthinkable till a few years back.

Allow me to explain. I am a working professional who commutes 45 kilometres (km) on an average every day. If I had to use the metro to reach my workplace, I would have to change trains at two different stations and then get down at the one 4km away from my office. I would not even want to get started on the availability of bus options on this route.  I must impress upon you that delivery of services is not the exclusive domain of the government. 

Before I started using Ola and Uber, I used to rely on radio taxis. I did try the metro as well but consistent haggling with autorickshaw drivers for those last 4 km, coupled with the scorching Delhi heat, made that a frustrating experience. There were times when drivers quoted even up to Rs150 for 4 km. Sometimes they would simply refuse rides and I’d had to rely on cycle-rickshaws.

Let’s put this in perspective with surge pricing.

If I hire an UberGO from the same station to my place of work at 3X surge, which is a rare occurrence, I would pay about Rs120. The difference: an assured comfortable ride that is not time consuming, and yet, costs less than an autorickshaw trip. More importantly, the app gives me the option to option to use the service while prices are surging or get notified once the demand for taxis in the vicinity drops to meet the supply.

Today, I can’t imagine moving around the city without these options. The ease of a cheap, prompt, and convenient ride, right from one’s doorstep, has negated the need to own a vehicle.

What’s odd-even about?

This brings me to my next point. Sir, what are you trying to achieve with the odd-even rule? Are you not trying to reduce the citizens’ reliance on personal vehicles and encouraging them to use public transport? Then shouldn’t you provide them convenient and reliable alternatives?

A good bus and metro transit system is one part of the solution, but given its current state, we are nowhere close to offering people the comfort of last mile connectivity. Thus, services such as Ola and Uber became critical. The public needs to be convinced that there is a real alternative to owning a vehicle. For that, given the current demand-supply dynamics in this space, drivers would have to be incentivised during certain hours. This is what makes surge pricing important.

 The public needs to be convinced that there is a real alternative to owning a vehicle. Before the coming of taxi aggregators, I would spend close to Rs30,000 per month to get to work and back, hailing taxis that operate at government regulated fares. Now, even with surge pricing, I do not spend more than Rs18,000.

Your government’s decision to initiate the odd-even scheme has for the past four months encouraged me to explore car-pooling offered by these players. My monthly expenditure now varies between Rs12,000 and 14,000. If I owned a car, I would have ended up spending more than Rs20,000 in EMIs and petrol costs in the absence of odd-even.

Today, I can call a car at the press of a button and travel wherever I want, at affordable rates. Yes, there are instances where increased demand would require incentivising drivers. But as long as I am assured of prompt service and the option to be notified when fares drop, I prefer this over the next best alternative. I am certain that I speak for many professionals in this city whose lives have improved with this service.

There was a time when the regulatory regime compelled international businesses to exit the country and stifled domestic innovation due to lack of competition. As a result, most of our service sector remained unorganised and inefficient. With liberalisation and the advent of competition, Indian companies grew faster and the quality of services improved. However, even then, the urban transport system remained inefficient and frustrating.

We have now entered a phase of technological liberalisation and it is incumbent upon a public spirited government such as yours to facilitate growth in this space. Services such as Ola and Uber have the potential to transform the way we move and make our cities better. But poorly thought out government measures will retard innovation and scupper policy goals.

Yes, there would be disruptions caused in traditional transport spaces, but wouldn’t reviewing the existing regulations for these operators be better than to attack competition? I implore you to introspect about your vision for the people and Delhi and let us enjoy the option of having an affordable ride at our doorsteps at our convenience without interruptions.

Sincerely,

An Aam Admi

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