Commute to climate: The case for a carpool law in India

The Motor Vehicles Act, 1988 draws a sharp line between private (white-board) and transport (yellow-board) vehicles. A private car used “for hire or reward” without a permit invites penalties and possible suspension of registration. The 2019 amendment created a statutory category of “aggregator” and introduced a licensing regime, but it was drafted for ride-hailing, not ride-sharing.

The Ministry of Road Transport and Highways issued Motor Vehicle Aggregator Guidelines in 2020, followed by a substantially revised version in 2025 covering Ola, Uber, Rapido and similar platforms, with detailed rules on surge pricing, driver compensation, insurance and grievance redressal. Neither framework, however, creates a dedicated regime for genuine cost-shared carpooling between commuters. The result is policymaking by improvisation.

In late 2023, Karnataka’s transport department, after sustained lobbying by taxi unions, declared the use of white-board cars on carpooling apps such as BlaBlaCar and Quick Ride illegal, attracting fines under state motor vehicle rules.

Bengaluru — India’s most congested city, where BJP MP Tejasvi Surya has noted that vehicle numbers have risen sixty-fold since 1990 — was effectively asked to prioritise taxi-operator revenues over peak-hour decongestion. Maharashtra’s Aggregator Cabs Policy 2025 takes the opposite approach, expressly recognising carpooling, capping drivers at 14 pool trips per user per week, and requiring fares not to exceed RTA base rates.

Some states tolerate the apps; others penalise the same activity. Transport falls within the Concurrent List, but this patchwork looks less like a defensible division of powers than a refusal to legislate — and commuters are paying the price.

That cost is most visible on the Noida–Greater Noida Expressway at 6.00 pm. The 25-km corridor carries lakhs of IT and corporate employees daily, yet metro coverage thins beyond Sector 137, bus connectivity remains uneven, and corporate shuttles are available mainly to employees of larger firms. Everyone else improvises.

Informal lifts are commonplace. Women travelling to and from night shifts often rely on strangers because there is simply no reliable alternative. A regulated carpooling regime — with verified profiles, in-app tracking, women-only and women-driver options, and SOS integration — would in fact be safer than the unverified hitchhiking that weak public transport already forces on many commuters every day.

The absence of a central rule also explains why traffic police, relying on a literal reading of 'hire or reward', penalise pool riders on the assumption that any payment between strangers converts a private vehicle into a commercial one. Until the statute itself distinguishes a contribution to fuel from a commercial fare, that line will continue to be drawn by the constable on the highway.

Fuel prices may be the immediate trigger, but the larger case for regulating carpooling lies in climate policy and trade.

India’s updated Nationally Determined Contribution commits the country to a 45 per cent reduction in emissions intensity below 2005 levels by 2030 and to net-zero emissions by 2070. Phase I of India’s Carbon Credit Trading Scheme (CCTS), notified in 2023 and rolling out through 2026, covers nine energy-intensive industrial sectors. Its Offset Mechanism pipeline includes transport, though methodologies for shared-mobility credits remain under development.

Meanwhile, the European Union’s new Emissions Trading System, ETS2 — postponed last November by a year but now scheduled to begin trading in January 2028 — will, for the first time, impose an upstream carbon price on fuel suppliers for road transport and buildings, with a cap declining by more than 5 per cent annually towards a 42 per cent emissions reduction by 2030. The existing EU ETS covers heavy industry and aviation; ETS2 is the mechanism that will, in effect, price the petrol burned in private cars.

India’s CCTS will eventually have to interact with ETS2 and with a Carbon Border Adjustment Mechanism whose scope may yet widen. If app-mediated carpool trips were recognised as eligible activity under the CCTS Offset Mechanism, millions of empty seats could begin functioning as climate assets.

Indian transport policy would also be better positioned for the international carbon-market integration that is approaching, whether or not we are prepared for it.

A dedicated chapter in the Motor Vehicles Act — or a stand-alone Shared Mobility (Carpooling) Regulation, 2026 — should do a few straightforward things.

First, it should draw a clear statutory distinction between commercial ride-hailing and genuine cost-shared carpooling by defining the latter through a per-kilometre cost-recovery cap, daily and weekly trip ceilings, and a strict no-profit rule. White-board cars operating within those conditions should be expressly exempt from commercial permit requirements.

Second, the law should incorporate safeguards already present in the 2025 Aggregator Guidelines: KYC and police verification, location tracking, women-passenger options, in-app SOS functions, and certified app security.

Third, governments should pilot dedicated High-Occupancy Vehicle (HOV) lanes on major corridors such as Delhi–Meerut, Mumbai–Pune, and Noida–Greater Noida. American experience with HOV lanes since 1969, and the French use of white-diamond lanes around Paris, Lyon and Grenoble — backed by substantial penalties for solo drivers — suggests that even partial, dynamically activated systems can move more people in fewer vehicles.

Finally, the law should integrate verified pool trips into the CCTS Offset Mechanism, giving aggregators today — and commuters eventually — a direct financial stake in shared mobility.

The counterarguments deserve serious consideration. Licensed taxi and auto operators worry, with reason, about livelihoods. But a strict per-kilometre cap and trip ceiling can ensure that pooling does not become unlicensed ride-hailing by another name. Women’s safety advocates rightly demand robust verification; the regulatory template already exists. State governments guard their Concurrent List prerogatives, but a framework law establishing a national baseline while allowing states to notify fares and HOV lanes would preserve federal balance.

What is harder to defend is the current arrangement: the prime minister urges citizens to carpool while a regional transport office somewhere down the highway fines them for doing exactly that.

The Delhi government’s announcement, Kerala’s caps, and the global crude shock have together opened a narrow but genuine window for a sensible central carpooling law. The law should seize it before the next tanker is delayed somewhere off the Strait of Hormuz.

Views are personal

The authors are assistant professors of law and researchers on issues of constitutional governance and regulatory policy