Introduction of Bharat Taxi

More than a decade after app-based cabs entered India, a new government-backed service, Bharat Taxi, has launched, aiming to disrupt the ride-hailing market. The service was formally introduced in the National Capital Region (NCR) and parts of Gujarat.

Market Implications and Competition

• Pan-India Expansion: Bharat Taxi plans to expand nationwide within three years, increasing competition. 
• Pricing Strategy: Anticipated tariff war with discounted pricing and no surge rates. 
• Unique Cooperative Model: Drivers are owners, participating in the cooperative without paying commissions, unlike existing platforms like Uber and Ola. 

Launch and Initial Response

• Union Home and Cooperation Minister Amit Shah emphasized this cooperative initiative, not a direct government entry into the taxi sector.
• The platform has quickly gained traction, onboarding over 250,000 drivers and 850,000 customers in Delhi-NCR during its pilot phase.

Comparative Analysis

• Operational Model: Bharat Taxi’s zero-commission model contrasts with the commission and subscription models of incumbents. 
• Driver and Consumer Data: Approximately ₹10 crore distributed to drivers, completing over 10,000 rides daily. 
• App Downloads: Bharat Taxi has over 500,000 downloads compared to over 100 million for Ola, Uber, and Rapido. 
• Pricing Comparison: Bharat Taxi is priced lower than Uber but close to Ola and Rapido on many routes. 

Driver Benefits and Cooperative Structure

• Drivers, known as ‘sarathis,’ are members and co-owners of the cooperative, holding shares and electing leaders.
• Benefits: Personal accident insurance of Rs 5 lakh and family health insurance cover of Rs 5 lakh.

Reactions from the Industry

• Support from Unions: Cab aggregator unions have lauded the initiative for recognizing drivers as owners, ensuring fair incomes, and providing social security. 
• Rapido's Perspective: Praised Bharat Taxi’s model, aligning with its SaaS-based subscription approach. 
• Uber's Stance: Differentiates itself with a tech-enabled support system, customer service, and grievance redressal.