ECONOMIC UPLIFTMENT OF THREE-WHEELER AUTO-RICKSHAW DRIVERS: CASE FOR DUAL LICENSING POLICY

 

The Centre for Digital Economy Policy Research

Indian Institute of Technology, New Delhi

New Delhi, Delhi 110018

Professor Anoop Chawla

Volvo Chair & Professor at the Department of Mechanical Engineering

Indian Institute of Technology, New Delhi

New Delhi, Delhi 110018

Date: 14^th October, 2022

In a report by the Centre for Digital Economy Policy Research (C-DEP), in collaboration with Professor Anoop Chawla from the Indian Institute of Technology, Delhi, it was found that income levels of autorickshaw drivers can be boosted by minor modifications of existing regulations.

This report, titled as, Amplifying Income Potential of Three-Wheeler Auto-Rickshaw Drivers: Case for Dual Licensing Policy, studies the three-wheeler autorickshaw industry and points out that the drivers of these autorickshaws are in a perpetual state of economic hardship. This is because the three-wheeler drivers have significant number of idle hours with no revenue generation in the absence of alternative usage of their assets for meaningful revenue generation. The report found that the daily working hours of auto drivers is approximately 10-12 hours, and the mean distance travelled varies from 70 to 80 kms. Thus, at an average speed of 25kmph, it amounts to a utilization of only about 30-35%. The underutilization of the autorickshaw as an asset is also a national economic loss.

Thus, keeping the above in mind, the report suggests the government should launch a pilot program for a limited experimentation period to observe the benefits of a Dual Licensing Policy and assess its overall impact on the eco-system. While the pilot is commissioned with appropriate approvals from the government authorities, it is also suggested that the government may consider the option of working towards the creation of a committee/working group with representatives from industry, academia, technical experts and representatives from the autorickshaw drivers, focusing on the income enhancement of auto rickshaw drivers through the adoption of dual licensing permits for three-wheeler autorickshaws.

The report further indicates the benefits of a dual licensing policy through substantial data points and key readings as mentioned below:

Auto Drivers in Delhi
Current Status	Post Dual Licensing (estimated)
Daily Collection (INR): 700 – 800 Daily Expense (INR): 200 – 300 Additional Monthly Expenses (INR): 2000 – 3500 (servicing, renewing permits, etc.) Daily Earning (INR): 500 – 600	Additional Daily Mileage (KMS) – 60 Additional Gross Income (INR) – 600 Net Surplus (INR) – 300 – 400 (after accounting fuel and food expenses)

·         The report also indicated that from a comparison of regulatory requirements, the structural requirements for three-wheelers intended for passenger carrier (L5-M vehicles), and goods carrier (L5-N vehicles) have only one major distinction - the requirement for a separate load body or compartment for carrying goods. Consequently, any passenger three-wheeler can serve as goods carrier if the goods are transported duly following the proposed safety measures.

·         Further, after an analysis of the Motor Vehicles Act, 1988, the report showcased that the central government has the power to exempt specified categories of vehicles from the applicability of the law to promote innovation, research, and development in the fields of vehicular engineering, mechanically propelled vehicles, and transportation.

Dr. RK Mitra, Principal Advisor, Centre for Digital Economy Policy Research (C-DEP) said, "Dual usage/licensing of three-wheeler autorickshaws will pave the way for innovation, in-city logistics and ease of doing business."

Commenting on the study, Ashish Rawat, CES, (Road, Ministry of Road Transport and Highways) said, “As a policymaker, safety will be a primary concern while considering the dual licensing policy. Fleet management system will also be very crucial for effective implementation of the policy.”

Professor P. Vigneswara, Dept. of Management Studies, IIT- Delhi said,” Stakeholders need to be educated on the usage of the policy. There will be multiple benefits of such a dual usage licensing policy in terms of creating revenue for drivers, enhanced last mile connectivity. On the brighter side, household income of drivers will also increase creating a positive impression on the country’s overall economy.”

“Autorickshaws are the backbone of the Indian urban passenger carry segment. With more and more tech enabled aggregator platforms, the importance and demand of autorickshaws will only grow in the coming years. They hold tremendous potential to penetrate into the logistics ecosystem, which in itself is a major contributor to the Indian economy. The adoption of dual licensing permits for three-wheeler autorickshaws will also ensure a rise in the gross income of drivers, subsequently uplifting their economic status” – Professor Anoop Chawla, Indian Institute of Technology.

“Dual licensing is a unique initiative that will ensure significant increase in the income levels of the auto rickshaw drivers by ensuring access to more segments in the Indian urban logistics. It will also lead to greater utilization of the autorickshaw as an economic asset and thus increase productivity in the economy. We strongly recommend that government should consider adopting a roadmap to enable autorickshaw drivers to access the small cargo carrying market” – Quote by Dr. Jaijit Bhattacharya

About CDEP:

CDEP is an independent Delhi Based think tank focused on digital transformation through dedicated policy research in the area of digital economy.

The organization’s main focus is on promoting aspects of the Indian Digital Economy and to facilitate the creation of a larger e-commerce, manufacturing and services ecosystem, based on non-discriminatory policies.

C-DEP’s objective is to bring together the finest brains in Academia and Industry to formulate draft policies on Digital Economy that will help economic growth and prosperity of India. It collaborates with thought leaders from across the world, for the purpose of supporting and sensitizing the Government of India in its various initiatives to make India a global digital industry hub. 

CDEP Address: E-158, Second Floor, Kalkaji, New Delhi – 110019.

Contact person: Sharad Venkatraman, Senior Policy Analyst

Contact No: +91 9040898228

About Professor Anoop Chawla:

Professor Anoop Chawla is the Volvo Chair & Professor at the Department of Mechanical Engineering, Indian Institute of Technology. He was previously associated with University of Illinois at Urbana Champaign as a Visiting Faculty for Computer Science and Engineering. He is an also fellow of the Institution of Engineers, India.

Professor Chawla has various publications in the field of mechanical engineering, such as, Motorcycle safety device investigation: A case study on airbags and Three-wheeled scooter taxi: A safety analysis.

Dr Chawla holds a PhD from the Indian Institute of Technology Kanpur.