Nearly a year has passed, but officials say the ride-hailing service guidelines are still in the discussion phase. Government changes caused the delay.

In February, the government amended the Industrial Enterprises Act 2020 recognising ride-hailing businesses as service-oriented, giving them legal status after seven years of operation in Nepal. However, 10 months later, the guidelines still remain stalled.

Due to the lack of ride-hailing guidelines, a large number of service seekers are being cheated daily in terms of price and safety, and no one is listening to their grievances and complaints.

“The government changed when the ride-hailing guidelines were tabled at the Cabinet for approval. Now the new government is studying and discussing the draft again,” said Balram Niraula, secretary at the Ministry of Labour, Employment and Transport, Bagmati Province.

Niraula said that when the government makes changes, it requires them to start working from scratch, and the same happened with the ride-hailing guidelines.

“During the previous Pushpa Kamal Dahal-led government, we had tabled the draft of the guidelines in the cabinet. But the government changed and we had to start over,” he said. “Now we are updating the draft.”

Another official at the Transport Ministry said the new minister needs to understand both the ride-hailing services and the guidelines that have been prepared. “It takes time.”

During Tihar, many customers in the Kathmandu Valley were forced to pay exorbitantly high rates for services from InDrive and Pathao.

Customers expressed anger on social media platforms and said they were charged Rs2,700 for a taxi ride from Naya Thimi of Bhaktapur to Kapan.

Later, the ride-hailing companies said that the surge in fares was caused by fewer available drivers and high customer demand during the festive time.

After operating unofficially for two years, the ride-hailing app inDrive was officially launched in Nepal in May. InDrive’s services are available in Kathmandu, Pokhara, and Chitwan. The company offers taxi, motorcycle, delivery, and intercity rides in Kathmandu.

Frustrated with the public transport system, many people in the Kathmandu Valley rely on ride-hailing services for commuting. However, customers are not only cheated on price, their safety is also at risk due to offline rides.

Ride-hailing companies said that despite a five-year old directive from the Patan High Court to regulate the sector by making laws, the government has not been able to implement any guidelines.

With ride-hailing apps, riders could book, track and pay for their rides straight from their phones, and quickly navigate through clogged streets.

Online app-based ride-hailing has drastically changed transportation, especially for the people in Kathmandu Valley. Ride-hailing motorbike taxi services employ thousands of people in Nepal, especially youth.

Despite its growing popularity, there have been many instances of harassment. According to the government’s report, ride-hailing companies are increasing in Nepal and generating high revenues, but they are not registered and do not pay taxes.

In 2017, Tootle debuted as the first ride-hailing app in Nepal.

However, after two years, in January 2019, the government cracked down on ride-hailing platforms like Tootle and Pathao, but public pressure forced the government to back down, as these apps had fundamentally changed how Nepalis travelled.

Subsequently, the Bagmati Province Vehicle and Transportation Management Act 2019 was implemented in February 2019 as the first legislation of Nepal to recognise the ride-sharing business through provincial law.

Bagmati province declared ride-hailing services legal but issued no guidelines or policies.

The Motor Vehicles and Transport Management Act 1993 states that vehicles registered for private use should not be used for public transportation.

The government officially recognised ride-hailing services as a service-oriented industry in February this year under the Industrial Enterprises Act 2020. This amendment, published in the Nepal Gazette, granted ride-hailing companies legal status, affirming their place within the industrial sector.

Foreign companies operate most ride-hailing apps in Nepal.

The 61st annual report of the Auditor General said that despite private number plate vehicles being operated through ride-hailing platforms as public vehicles, they are not registered with the Department of Transportation Management to provide such services.

The auditor general's report has highlighted issues concerning the regulation of ride-hailing services, but no action has been taken to address them so far.

The draft ride-hailing guidelines propose mandatory vehicle registration. Ride-hailing drivers must register their cars and motorbikes in a manner similar to traditional taxis and operate under the regulation of the Ministry of Transport.

Companies would also be required to renew their operations annually at transport management offices. The guidelines aim to regulate fares and propose mandatory insurance for passengers.