Cooperative Taxi Service: A New Chapter for India's Ride-Hailing Market? If executed well, Sahkar Taxi could mark a pivotal shift not just in the cab market, but in how we reimagine fair, inclusive, and cooperative-led economic models in India
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The recent announcement by Union Home Minister and Minister of Cooperation Amit Shah regarding the launch of a cooperative taxi service (Sahkar Taxi) in India has made headlines across the country. If successfully implemented, this initiative has the potential to revolutionise the cab market in India.
As of 2024, the taxi services market in India stands at USD 20.50 billion and is projected to reach USD 23.40 billion by the end of this year. By 2030, it is expected to touch USD 44.18 billion, growing at a CAGR of 13.55 per cent during the 2025–2030 period, as per the Mordor Intelligence. The key drivers behind this growth include rapid urbanisation, rising disposable incomes, and the convenience offered by these platforms—such as flexible pick-up and drop-off locations, access to driver and vehicle details, and seamless online payments.
Duopoly in the current market
Presently, the Indian cab market is dominated by Ola Cabs and Uber Technologies. Ola operates in over 160 cities, while Uber has a presence in nearly 98 cities. However, consumer satisfaction remains questionable. Concerns related to safety, surge pricing, and lack of accountability often make headlines. Yet, due to limited alternatives, many passengers feel compelled to use these services.
On the other hand, both Uber and Ola follow similar business models, charging drivers a commission ranging from 20 per cent to 40 per cent of the fare per ride. Drivers often express dissatisfaction, citing poor earnings and limited bargaining power due to the centralised control of these platforms. This has led to growing discontent within the driver community.
Sahkar Taxi: direct-to-driver model
This is where Sahkar Taxi steps in—a government-backed cooperative alternative to private ride-hailing apps. Under this model, drivers retain full profits, as there are no commission cuts. Instead, they pay a nominal subscription fee, similar to the model followed by Namma Yatri in Bengaluru. This could be a fixed monthly fee or a per-ride charge, granting drivers access to the platform's services.
As per the Minister, Sahkar Taxi will accommodate all types of vehicles—two-wheelers, three-wheelers, and four-wheelers. "This is not just a slogan. The Ministry of Cooperation has worked relentlessly for three and a half years to implement this on the ground. In a few months, a major cooperative taxi service will be launched, ensuring direct profit flow to the drivers," the Minister stated.
The cooperative model will empower drivers by granting them ownership through cooperative structures, enhancing income security, and promoting local economic participation—aligning with the government's broader initiative, 'Sahkar Se Samriddhi' (Prosperity through Cooperation).
Will it work?
While it's too early to predict the success of Sahkar Taxi, however, initiatives like this could compel existing ride-hailing companies to adopt more equitable and driver-friendly practices. The launch of Namma Yatri, for instance, triggered a significant shift in the industry, prompting others to follow suit. In February 2024, Rapido transitioned to a zero-commission model to attract more offline drivers. Following that, in April 2024, Ola introduced subscription-based plans for auto drivers across major cities including Delhi-NCR, Mumbai, Bengaluru, and Hyderabad. By February 2025, Uber also embraced a similar subscription-based approach, signaling a broader industry trend towards more sustainable and inclusive business models.
If executed well, Sahkar Taxi could mark a pivotal shift not just in the cab market, but in how we reimagine fair, inclusive, and cooperative-led economic models in India.
