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India plans S'pore-style tax for cars entering city centres

Publication Date : 04-02-2013


India is pushing its cities to introduce a Singapore-style tax or charge for cars entering city centres, as cities like Bangalore and Delhi add more than 1,000 private vehicles a day.

The federal government has asked all state governments to identify the most congested roads in their cities, study traffic systems in Singapore and London and see how they can dissuade car owners from driving into the city centre.

It is even open to giving federal funding to kick-start the process, even though an attempt to introduce a similar congestion tax failed in Delhi last year because of political opposition.

This is the first time the federal government has asked states to consider this. "To start with, we may have the manual permit/ coupon system as was done in Singapore when it introduced congestion pricing for the first time. These can be upgraded at a later date," Dr Sudhir Krishna, a top official at the Urban Development Ministry, wrote in a advisory letter to the heads of all the states.

The idea is to have motorists buy permits or coupons to enter certain roads and areas.

A case study on how Singapore did it, which explains its Area Licensing Scheme started in 1975, has also been sent to all states.

Traffic has been building up in the country of 1.2 billion, where double-digit economic growth in the last decade has seen a boom in private vehicle ownership. Middle-class families are increasingly having two cars or more.

A study by the Transport Corporation of India and the Indian Institute of Management in Kolkata calculated that the country loses 600 billion rupees (US$11.28 billion) in productivity a year due to congestion.

The Urban Development Ministry now wants to introduce a road tax and raise parking charges, which currently can be as low as 10 rupees for a day, while improving public transport.

Public transport has been improving, though not fast enough. City bus services are now available in more than 65 cities, up from just 20 cities in 2006.

Some ideas for the road pricing system include selling permits to enter busy city centres at supermarkets and corner shops, setting up cameras on chosen roads and hiring traffic wardens.

But ultimately, the implementation will be up to states, where there is political opposition to implementing taxes of any sort.

Last year, Delhi's municipal body proposed a tax of 100 rupees to 200 rupees for vehicles entering the city centre, but ditched it, fearing a public backlash.

S. K. Lohia, a senior official at the ministry, thinks municipal bodies will have little choice but to do so soon. "Political opposition to any proposal is a natural process, what is required is you have to explain and build awareness," he added.

In an example of how bad the traffic has become, Delhi's Ring Road, a 48km stretch that circles the city, was originally planned for 75,000 vehicles a day. Instead, 160,000 use it every day. By 2016, it is expected to cater to 400,000 vehicles, according to a study by a group of agencies.

Some cities are already taking preventive steps. In Aizawl, in the north-eastern state of Mizoram, cars are registered only on proof of parking space, a move being considered in Rajasthan state.

Critics note implementation will be tough, particularly when drivers already ignore basic traffic rules, such as observing speed limits and keeping to their lanes.

Regardless, Anumita Roychowdhury, executive director of the non-profit Centre for Science and Environment, called the advisory an important step. "It is official recognition of the fact that congestion is unsustainable."


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