Centre Proposes Major Rent-a-Cab Reforms, Minimum Fleet Requirement Cut to Five

New Delhi: The Centre has proposed sweeping changes to the Rent-a-Cab framework, reducing the minimum fleet requirement from 50 vehicles to five and introducing a single electronic licence to make it easier for businesses to enter and operate in the sector.

The proposed reforms by the Ministry of Road Transport and Highways aim to simplify licensing procedures, expand rental options and strengthen passenger safety.

Under the new framework, operators will be allowed to offer cabs with or without drivers, with a minimum of two vehicles required at each operating location. The existing requirement to maintain branches in five tourist cities will also be scrapped.

A single licence valid across the state or Union Territory will replace separate licences for main offices and branches. Airports, railway stations and bus terminals may also be approved as operating locations.

The ministry has proposed a 60-day deadline for granting and renewing licences, while applications to add or remove vehicles and operating locations will have a 30-day deemed-approval provision.

On passenger safety, cabs will be required to have location-tracking systems and first-aid kits. Operators must also provide round-the-clock grievance support, emergency repairs and towing facilities.

The proposal includes police verification of operator-provided drivers, provisions for driver welfare and an electronic appeals mechanism. It also provides operators an opportunity to rectify certain non-material violations before suspension or cancellation of licences is considered.

The government said the changes would lower entry barriers, encourage smaller entrepreneurs, create employment opportunities and improve passenger services.