Ola, Uber Fares Set at 50% Minimum; Bike Taxis Legalised Under New Guidelines

The Motor Vehicles Aggregator Guidelines 2025 was announced by the Ministry of Road Transport and Highways on 1^st July, a document that could reshape how Indians hail ride or hop onto bike taxis. The guidelines, which could alter the daily commute of millions, bring long-overdue legitimacy to bike taxis, promote electric mobility, introduce mandatory training and insurance for gig workers, and encourage more inclusive ride platforms. It appears, at first glance, to be a progressive blueprint for the future of urban mobility. But in India, where transport policy often looks better in print than in practice, the road from regulation to real change is rarely smooth.

After years of being shuttled between courts and state transport departments, the guidelines now give bike taxis a legal path—if states choose to adopt it. Informal bike taxis have been plying Indian roads for years, especially in Tier 2 and 3 cities without legal status or regulation. In 2024, the top three bike taxi aggregators in India completed around 280 million rides. However, they play a pivotal role in ensuring affordable rides and ensuring first and last-mile connectivity for young workers navigating narrow lanes. The new guidelines can offer them legitimacy, but there’s a catch. The fine print leaves key safety features—helmets, ride-tracking, insurance—as state-level decisions.

With politically powerful auto unions in several states resisting this shift, it’s entirely possible that most states will either dilute or delay the change. For example,  Goa, a state where the stronghold of local taxi unions has repeatedly resisted the entry of aggregator platforms like Ola and Uber, arguing that such services would undercut their earnings. Despite massive tourist demand for reliable and app-based rides, successive governments have either banned or severely restricted aggregator operations under union pressure.

Karnataka, despite being India’s startup capital, has stalled on regularising bike taxis due to union pushback and consequently announced a ban on bike taxis early in June. Maharashtra floated a public notice seeking feedback just a day before its deadline. Legalisation doesn’t mean implementation, especially when states are not nudged or incentivised to act.We may have finally green-lit the vehicle, but forgot to build the road.

What’s also striking is what the guidelines don’t mention. While there is an explicit nod to non-transport two-wheelers being used for ride-sharing, there is complete silence on four-wheeler carpooling using private vehicles. Across cities like Bengaluru, Hyderabad, and Pune, informal carpool networks using private hatchbacks and sedans are already thriving, often via messaging apps or informal aggregator platforms. In an era where reducing congestion and pollution is a policy imperative, this omission feels like a blind spot. Ignoring the carpooling reality also risks pushing these services further into legal grey zones.

When it comes to fare regulations, aggregators such as Ola and Uber can't go wild with surge pricing—they’re capped at 2× base fare (up from 1.5×); minimum fare must be 50% lower than the base fare to cover at least 3 km of dead mileage. Drivers must get 80% of earnings if they own the vehicle, 60% if they don’t.

The guidelines also ask aggregators to comply with EV targets set by state authorities or pollution control boards. However, there is a lack of clarity on the targets, timelines, and the support for transition to EV. India’s EV-to-public-charger ratio remains high, with one public charger for every 135 EVs, far behind global norms of 6–20 EVs per charger. Without subsidies, EV-friendly financing, or tax breaks, this requirement risks burdening the very drivers it’s meant to empower.

The guidelines stipulate that the issuance of an aggregator license must be facilitated through a centralized “designated portal,” with applications to be processed within a stipulated period of 90 days. The license, once granted, will carry a validity of five years and will require the payment of a licensing fee of ₹5 lakh, along with a security deposit in the form of a bank guarantee or bond, as specified.

Perhaps the most progressive shift comes for the people who make these platforms run: the drivers. Over 3 million Indians rely on ride-hailing platforms for income. For the first time, a 40-hour mandatory training—covering everything from gender sensitivity to emergency response—is required before onboarding. Health and life insurance (₹5 and ₹10 lakh, respectively) are also non-negotiable. But there’s no mention of audits, compliance checks, or third-party evaluations. It’s hard to see how this won’t turn into another checkbox exercise. More importantly, these are gig workers, many of whom live paycheck to paycheck. Are aggregators being nudged to absorb the costs of this training period? Will the state subsidise the insurance or medical checkups? These questions remain unanswered.

Let’s talk about accessibility—the kind we rarely design for. States are now empowered to mandate a quota of Divyangjan-friendly vehicles in every fleet. But with policies already in place where there is limited scope for vehicle modifications, the real question is how inclusive these fleets are in reality.

On the tech side, language access gets a rare win. Aggregator apps must now be available in English, Hindi, and the official language of the state. It may seem like a minor tweak, but it’s a major shift for drivers, many of whom aren’t fluent in English. By designing for real users, the guidelines nudge aggregators towards genuine inclusivity.

The Centre has passed the baton to states to implement the guidelines within 3 months, but still needs to offer the tools or incentives needed to implement these reforms meaningfully. What India’s urban mobility ecosystem needs now is not just regulation, but reinforcement through funding, clarity, and accountability.