At last, Uber has found a friend in India

Uber paradise.
Uber paradise.
Image: AP Photo/Mahesh Kumar A.
We may earn a commission from links on this page.

Uber has finally found an Indian state that likes it.

After months of regulatory battles with a number of states in India, Uber has signed an agreement with the Telangana government for setting up an office in Hyderabad.

The San Francisco-headquartered taxi aggregator will invest $50 million (Rs316 crore) in the facility—its biggest office outside the US—over the next five years, the company said on July 6.

In its new office in India’s youngest state, Uber will develop new products and train thousands of drivers in Hyderabad, Telangana and Andhra Pradesh’s capital city.

Uber and the Telangana government will also create a new regulatory framework for on-demand transportation technology, which may be passed “in the next four weeks,” the company said in a statement. Elsewhere in the country, however, there is a continuing debate on whether these companies should be classified as transport providers or be covered under the information technology laws.

In April this year, Uber had also chosen Hyderabad to experiment with cash payment for the first time ever.

Hyderabad is one of India’s leading technology hubs, with large offices of multinational firms including Google, Accenture, Amazon, Dell and Cognizant. 

“India is a global priority market for Uber, along with China,” an Uber spokesperson told Quartz. “It is also one of the fastest growing markets for Uber and we are investing heavily in India. We will be expanding to many more tier 2 and 3 cities as we grow our footprint.”

Rough ride

Just six months ago, Uber— along with peers Ola and TaxiForSure—had faced a nationwide ban after a driver using its platform allegedly raped a female passenger in Delhi. Hyderabad was also among the cities that had announced a ban on Uber.

In several states, app-based taxi-hailing services are still banned but continue to operate illegally. Amid the confusion, Telangana has become the first Indian state to embrace Uber.

Despite these issues, Uber, which started operations in India in October 2013, has continued to grow steadily.

“The rapid 40% month-on-month growth we continue to see in India is unprecedented and it is not surprising that some of the fastest growing cities in the world are also here,” Neeraj Singhal, Uber’s head of expansion for India, said while announcing the service’s launches across seven new cities earlier this month.

Uber now operates in 18 Indian cities, but is way behind competitor Ola, which operates across at least 65 cities and is targeting 200 cities by the end of 2015. Globally, Uber operates across 300 cities.