Can Carpool Reduce Emissions and Congestion in Indian Cities?

In response to the burgeoning problem of air pollution, cities around the world have identified motor vehicles as a significant contributor to poor air quality. To address this issue, cities are piloting measures to shift people to public transport and restrict single occupancy vehicles in urban centers. For example, several trials have been launched in Paris since December 2016, ranging from a move to make public transport free to implementing vehicle restriction measures.

Indian cities have become notorious for poor air quality. A World Health Organization study in 2016 showed that half of the 20 most polluted cities in the world are in India. In December 2015, Delhi recorded PM 2.5 at 295 microgram/m3 (as per System of Air Quality and Weather Forecasting And Research) which is almost 15 times higher than the World Health Organization safety limit of 20 microgram/m3. Since there is no formal mechanism for issuing pollution alerts to citizens, the National Green Tribunal issued a directive to warn people about the severe air pollution and recommending reduction in spending outdoor time. In order to tackle vehicular emissions, the Delhi government instituted a private vehicle rationing scheme, known as the odd-even scheme, for a period of two weeks each in January and April 2016.

Of all the measures, the vehicle rationing measures were highly covered by the media. In response, a multitude of private and government led carpool initiatives were set up including UberCommute and the Delhi government’s Poochh-O Carpool app. Existing carpool platforms in the National Capital Region such as BlaBlaCar and Orahi also saw a significant jump in usage.

The Growth of Carpool Platforms

Shared rides between people is not a new concept, especially for commutes to work or to school. Historically, such arrangements are barter or cost-share driven. While such informal arrangements have existed for years, the increase in smartphone penetration has drastically formalized the market.

For a commuter looking to carpool, getting a ride starts with a smartphone app or website. Ride-seekers enter their travel origin and destination points. And, in an ideal scenario, within minutes the system matches a ride-seeker with a ride-giver who is travelling in the same direction. Rides can be shared within a city and for long-distance trips between cities too.

Access to real-time location has broadened people’s ability to discover carpool opportunities and the ease of digital payments has circumvented the often awkward exchange of cash. Carpool platforms advertise the comfort of a car at a cheaper price point, for instance, a ride for a distance of 15 kms can cost INR 180-250 in a AC taxi (and INR 100-120 in shared taxi) versus INR 50-80 in a carpool arrangement.

The carpool business has been growing steadily in India and WRI India has tracked the launch of over 85+ carpool platforms since 2015 across various Indian cities. According to BlaBlacar, over 3 million seats were made available on their platform between January 2015 and June 2016.

However, commuter concerns around safety and security continue to be a barrier to scale. In addition, ambiguity around the legality of carpool businesses within the Indian regulatory framework restricts access to investment. The few investments in this market include INR 3.5 crore raised by Orahi from Indian Angel Network in January 2016 and Snapdeal’s investment into Cloudacar in March 2016.

Impact of Carpool During the Odd-Even Scheme

According to a study by the University of Chicago, the January 2016 phase of the odd-even scheme resulted in a 20% reduction in PM 2.5 during the day and a 5.4% increase in average speed of vehicles indicating a reduction in congestion.

While the impact of carpool cannot be disaggregated from these numbers, we can observe that there was a significant rise in carpooling activities during the scheme. According to Blablacar and Orahi, there was an increase of 25% and 350% respectively of rides made on their platforms in the April 2016 phase of odd-even. Whether this reduced or added to emissions and congestion is dependent on what mode of transport people shifted from.

Ridership of carpooling companies during the odd-even scheme in Delhi NCR in April 2016

Source: Data obtained from Blablacar and Orahi

Mixed Policy Responses Towards Carpool

Carpool businesses have received a mixed response from the local government in India. A number of traffic police organizations encourage people to carpool. For instance, in Bengaluru – a city with 60 lakh vehicles on road – the Traffic Police and Karnataka State Pollution Control Board endorsed Let’s Drive Along, a carpool app. Even in Kolkata, the Police Department and IIT Kharagpur are working with the Pool Car Operators Welfare Association to promote carpool where buses are not available.

However, the legality of such models remain a grey area, since there are no provisions for carpooling in the Section 66 of the Motor Vehicles Act. Conversations with regulators highlight concerns around the blurring line between private and commercial services.

In December 2016, the Ministry of Road Transport and Highways (MoRTH) released a draft proposal for taxi policy guidelines. An addendum to this draft by Niti Aayog, the premier policy think-tank of the Government of India championed for the pooling or sharing of private cars through appropriate app-based solutions and urged MoRTH to announce a clear policy specifying the parameters and regulations for such a system.

For Indian cities, where the share of non-motorized and public transport has historically been high, the impact of models such as technology-enabled carpool continues to evolve. Some big questions still need to be answered when we think of the impact of carpooling models.

Will these models result in people shifting out of buses or out of single occupancy vehicles? Will it keep people from buying a second, or even their first car? And can carpool be a useful model for creating access to areas where there is a lack of adequate connected and accessible public transport?

The above questions still remain, but with the steady growth of carpool platforms on one hand and intensifying policy conversations on the other, the year 2017 could be a game changer for this industry.

WRI India actively tracks the new mobility ecosystem, designs knowledge programs for mobility enterprises, and supports decision making at the policy level to improve commuting in Indian cities. To connect with us, write to innovation@wri.org.