Cab Fares to Double During Peak Hours: Will Indians Stick to Two-Wheelers as Cabs Get Costlier?

The Ministry of Road Transport and Highways has updated its Motor Vehicle Aggregator Guidelines, 2025, permitting cab aggregators like Ola, Uber and Rapido to charge up to twice the base fare during peak hours. This is an increase from the earlier limit of 1.5 times the base fare. During non-peak hours, the minimum fare can be as low as 50% of the base fare.

For many Indians, especially in metro cities, cab travel is already seen as an expensive option, often reserved for emergencies or when public transport isn't available. With this new rule, the gap between cab fares and the cost of two-wheeler travel is set to widen further.

Voices from the Streets

Rohit, a daily commuter in Bengaluru, says,"I use my bike for office because cabs are just too expensive, especially in the evenings. If the fares go even higher, I'll only book a cab if it's absolutely necessary."

Cab drivers, however, feel the surge is justified. "We spend hours in traffic and sometimes drive long distances just to pick up a customer. The higher fare during peak times helps us cover fuel and our time," says Arjun, an Ola driver in Delhi.

Key Guidelines at a Glance:

Base Fare: Minimum chargeable distance is 3 km to cover 'dead mileage' (distance travelled without a passenger).

Fare Charging: Passengers pay only for the distance from pick-up to drop-off, unless the trip is under 3 km.

Cancellations: Both drivers and passengers face a penalty of 10% of the fare (up to ₹100) for cancelling without a valid reason.

Why Two-Wheelers Remain King

With cab fares rising, two-wheelers continue to be the preferred choice for most Indians. They are not only more affordable but also help beat traffic and save time. The popularity of scooters and bikes is reflected in the booming sales figures and the growing acceptance of bike taxis for last-mile connectivity.

The Bottom Line

As cab rides become even more expensive during rush hours, most Indians are likely to stick with their trusty two-wheelers for daily commutes. While surge pricing may help cab drivers earn more, it's clear that for the average commuter, the humble scooter or bike remains the most practical and pocket-friendly option.