Karnataka Will Legalize Electric Bike Taxis; Uber, Ola, Rapido Should Be Very Happy!

Now here is some good news for Uber, Ola, Rapido in Bangalore!

The Karnataka government on March 5, proposed using electric two-wheelers as taxis on Bengaluru roads, potentially surpassing regulations around using petrol-powered bikes as taxis in the state.

Read to find out more…

What is the Fuss About?

In the budget for financial year 2020-21, Karnataka government proposed implementing an electric bike taxi project to improve last mile connectivity of public transportation, without divulging details.

It is said in the budget, “To improve the last mile connectivity in public transport in Bengaluru, it is proposed to implement “Electric Bike Taxi” project.”

This move has finally fulfilled the longstanding demand of Rapido, Uber and Ola to allow use of two-wheelers as taxis. However, the state had delayed the rules despite getting approval from the Centre.

The initiative seems good in theory by contributing to sustainable development but will it work practically?

What is the Stand of the Players in the Bike Taxi Space?

Some companies called out Karnataka’s proposal as revolutionary, they said they would wait for details before commenting on its ability to work successfully. On the other hand some said the proposal would be hard to pull off in the near future, given a lack of electric two-wheelers on the roads today.

Vivekananda Hallekere, co-founder and CEO of Bounce, a two-wheeler rentals startup said, “The biggest reason bike taxis worked was that a person who had a scooter or motorbike could now make money ferrying people. The proposal by Karnataka would mean that people will need to start buying electric scooters and I don’t know how successful that would be.”

He also added that the current model of bike taxis where bike owners attach themselves to platforms will not work under Karnataka’s proposal, but it could lead to mobility firms building their own fleets of two-wheeler EVs.

A senior executive at one of India’s leading cab aggregators, however, questioned the viability of companies building their own fleets of electric two-wheelers. “We tried leasing cars to drivers in the past, but the economics of the business did not work. It would be similar with electric bikes,” the person added.