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[UPDATE] Taxi aggregators Ola, Uber are violating the law by measuring distance through GPS: Road Ministry

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Online taxi aggregators in India have once again come under the scrutiny of government agencies. And this time, regulators have raised objections against their system of calculating trip distance through GPS. According to an ET report, the road ministry wants these aggregators to measure the distance through traditional taxi meters.

Taxi aggregators are currently violating the law by measuring distance through GPS. The Motor Vehicles Act clearly says that they have to go by the taxi meter,

said an official of the road ministry.

The transport ministry believes that the fare calculated through GPS is inaccurate and the black-and-yellow taxi rate card is better for consumers.

We keep getting complaints of inaccuracies in the fare mechanism of these cab aggregators. We have told both Ola and Uber during the recent meetings that they have to fix this problem immediately,

added the official.

It is noteworthy that private taxi operators and autos in Delhi recently went on a three-day strike to oppose against these aggregators. They alleged that these aggregators were operating illegally and demanded to bring them under law and make them follow government prescribed fares.

Earlier this week, Transport Minister Nitin Gadkari revealed in Rajya Sabha that the ministry was working on comprehensive guidelines to cover new-age taxi aggregators. They have formed a committee under Roads Secretary Sanjay Mitra to draft these guidelines.

For this purpose, they have also received inputs from the states. However, since online aggregators have ultimately benefited the local commuters, the ministry has asked states to only set a maximum fare instead of completely regulating the pricing.

The companies, thus, will only be able to vary prices within a certain limit. This means we may not see those unbelievably huge charges due to surge pricing in Uber or Ola. And at the same, we will be able to avail competitive rates from different taxi aggregators.

Uber and Ola have not yet responded to these reports. It is not the first time though that they are facing such situations. Since their inception in India, they have repeatedly come under objection of authorities for various issues. These issues include proper licensing, surge pricing, predatory pricing, use of diesel cabs in Delhi, etc.

However, the companies have maintained their stand to work with authorities to resolve these issues. In some cases, like Ola in Karnataka, the company followed instructions and got a proper license to operate. Uber, however, was not that lucky as it is still struggling against state and transport authorities to receive the required clearances.


The ministry has denied the Economic Times report. Here’s an official tweet :

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