In a recent directive, the Karnataka High Court has ordered a suspension on bike taxi services by app-based ride-hailing services operators, such as Ola, Uber, and Rapido.
This decision, handed down by Justice BM Shyam Prasad, stipulated that these services must cease until the state government enacts appropriate regulations under the Motor Vehicles Act, 1988. The court has granted a six-week period to facilitate the development of these regulatory frameworks. This action stems from the state government’s March notification last year, which banned bike taxi operations citing the lack of adoption of electric two-wheelers by ride-hailing platforms and alleged policy misuse.
The earlier ban on bike taxis was associated with the withdrawal of the Karnataka Electric Bike Taxi Scheme, which was first introduced on 14 July 2021. Designed to promote electric vehicle use, the scheme did not achieve its desired outcomes.
Justice Shyam Prasad has directed the platforms to halt their operations within six weeks and has instructed the government to ensure compliance with this directive.
Transport Minister Ramalinga Reddy welcomed the court’s decision, stating that the government has been granted three months to develop necessary regulations. He noted that the lack of regulations for app-based platforms has raised safety concerns for users.
In August 2021, a single-judge bench had previously directed authorities not to take ‘coercive action’ against Rapido, allowing its operations using non-electric bikes due to the absence of specific government regulations. Rapido, supported by Westbridge Capital and Nexus Venture Partners, has been providing bike taxi services in Bengaluru since 2016. The ongoing lack of regulatory clarity has presented legal and operational challenges for app-based bike taxi services in the region.
The bike taxi market in Bengaluru has been fraught with tension, with frequent conflicts arising between auto drivers and bike taxi operators. Last year, incidents were reported of auto drivers blocking bike taxis and even engaging in physical confrontations, with videos of these occurrences going viral.
Karnataka was the first state to introduce a dedicated policy to promote electric bike taxis. However, the government did not perceive a strong enough response from platforms to be encouraging, officials told the Economic Times. Despite EV startups making statements, there was a lack of license applications being submitted.
In October 2023, Delhi resolved the uncertainty by implementing a policy that permits the operation of bike taxis, but exclusively with electric bikes. Maharashtra has also recently allowed bike taxis, although certain conditions regarding the maximum distance of operations and minimum fleet size must be met.
