Uber and Ola have settled into a comfortable duopoly in India, but they might be seeing their biggest challenger yet — the Indian governent.
The Indian government will create a co-operative led competitor to Uber and Ola, Home Minister Amit Shah has announced. “PM Modi’s slogan of Sahkar se Samruddhi (Prosperity from co-operation) isn’t just a slogan. The Ministry of Co-operation has worked very hard for the last 3.5 years to turn it into a reality,” he said while addressing Parliament. Shah is also the Minister of the newly-created Ministry of Cooperation, which aims to strengthen the cooperative movement in the country.
“In the next few months, we’ll create a massive co-operative taxi service along the lines of Uber and Ola,” Shah said. “This will include two-wheeler taxis, autorickshaws and four-wheelers. The profits from this co-operative society won’t go to some businessman, but they’ll go directly to the drivers. This is the model we’re about to launch,” he added.
This isn’t the first time that a competitor to Uber and Ola has been envisioned. In 2017, Delhi’s taxi drivers had banded together and launched Sewa Cab, which was run by taxi owners themselves. In Kerala, a similar initiative had been mooted. But these initiatives have met with little success, and found it hard to break the Uber-Ola hegemony.
But in recent years, some successful competitors to Uber and Ola have been springing up. Rapido has operated on a model similar to Uber and Ola’s, and managed to garner some marketshare. More interestingly, Namma Yatri, which charges a direct subscription from drivers instead of a commission on each ride, has proven to be extremely successful in cities like Bengaluru. Namma Yatri runs on the government’s ONDC framework, and has now slowly expanded to cities including Kolkata, Kochi, and Mysore.
It’s unclear whether this co-operative model that Amit Shah is talking about will be based around Namma Yatri, but one would think that this initiative has a greater chance of success than many others that have been previously tried. For starters, it’ll have the weight of the central government behind it, so it’ll find it relatively easy to onboard drivers. Also, if there’s no middleman like Ola or Uber taking a cut, it’s possible that the initiative could improve driver earnings — while making riders cheaper for customers — so it could find users on both sides of the marketplace. Also, this government isn’t one to lightly make announcements they can’t fulfil, so it’s likely they’ll give it their best shot for it to succeed.
If the Indian government can indeed create a co-operative model for cab drivers, it would likely be the first government anywhere to have created such an alternative to traditional ride hailing companies. But India has had success with co-operative models in the past — in the 1950s, it had gotten together milk producers into a co-operative, and that’s now turned into Amul, which is the eighth-biggest dairy company in the world. And if it can do an encore with cab drivers, it could create a model for the rest of the world to emulate.