Ola, Uber Get Nod For Double Surge Pricing Under New Government Guidelines
Ola, Uber Get Nod For Double Surge Pricing Under New Government Guidelines
Cab users may soon see higher fares during peak hours as the government has approved a revised surge pricing cap for aggregators like Ola and Uber. Under the new Motor Vehicles Aggregator Guidelines (MVAG) 2025, issued by the Ministry of Road Transport and Highways on July 1, platforms can now charge up to twice the base fare during high-demand periods. Previously, the cap was limited to 1.5 times the base fare.
States have been advised to implement these updated guidelines within three months. The Ministry stated that the move aims to provide platforms with flexibility during rush hours while ensuring a regulatory framework for pricing and operations remains intact.
In addition to fare revisions, the MVAG 2025 introduces significant changes to India’s shared mobility ecosystem. For the first time, state governments have been empowered to allow the aggregation of non-transport (private) motorcycles for passenger journeys and hyperlocal deliveries. The objective, according to the guidelines, is to reduce traffic congestion, cut vehicular pollution, and improve last-mile connectivity in underserved areas.
States may also levy daily, weekly, or fortnightly fees on aggregators for operating such motorcycles under Clause 23 of the guidelines.
Bike taxi players like Rapido and Uber welcomed the move, calling it a milestone for India’s shared mobility sector. Rapido termed it a “milestone in India’s journey towards a Viksit Bharat,” while Uber said the revised framework provides “regulatory clarity and fosters innovation.”
“Timely adoption by states will be key to ensuring uniform implementation and building predictability for all stakeholders. We commend the ministry’s consultative and balanced approach,” an Uber spokesperson added.
The MVAG 2025 replaces the earlier 2020 version, reflecting the rapid evolution of India’s mobility landscape, including the rise of electric vehicles, e-rickshaws, and flexible pricing models. The Ministry highlighted that the updated rules seek to balance innovation and business ease with user safety, security, and driver welfare.
Central Government’s New Cab Aggregator Guidelines Are a License to Loot Citizens
“The recently announced guidelines for cab aggregators by the central government seem to give companies a free hand to exploit commuters. Peak hours, when citizens need rickshaws and cabs the most—such as office hours, during heavy rains, scorching afternoons, or holidays—will now see fares doubled. Non-peak hours, when demand is naturally low, will have reduced fares. On top of this, these companies themselves get the liberty to decide what qualifies as “peak hours.”. Introducing concepts like “happy hours” may work in bars and restaurants, but public transport is not a leisure business—it is directly tied to people’s basic needs. Be it someone going to work or rushing to a hospital, transport must remain affordable and accessible,” said Dr. Keshav Nana Kshirsagar, President, Maharashtra Kamgar Sabha / Baghtoy Rickshawwala / IGF Cabs.
“Shockingly, this dynamic pricing model has been brought in even though drivers never demanded such a system. This appears to be a policy designed purely to benefit international cab aggregator companies and increase their profits. We urge the central government to immediately withdraw this exploitative and ill-thought-out policy. Auto and cab drivers across the state have consistently demanded only one thing: to be allowed to operate at government-approved rates—not double fares. We are committed to serving our passengers honestly and do not wish to loot them. However, if these guidelines are not amended soon, we will be left with no option but to launch a statewide agitation, added Dr. Keshav Nana Kshirsagar.
