By Parth Piyush Prasad, Team WAF Think Tank
Introduction:
The Delhi Motor Vehicle Aggregator and Delivery Service Provider Scheme, 2023, is a salient policy, a ground-breaking policy for tackling vehicular emissions. Delhi’s atmosphere has suffered through years of heavy pollution, with vehicular emissions being one of the biggest contributors to it. The Government of the NCT use this policy to acknowledge that fact, and attempt to rectify the same over a long term. Their policy also acknowledges the growth of app-based aggregators and delivery service providers (henceforth, DSPs), and their massive involvement in the on-ground vehicles used often.
Thus, through the policy, the government creates a strong framework to transition from fuel-based vehicles to electric vehicles for all aggregators and DSPs by April 2030. The policy describes a new process for on-boarding electric vehicles, and involves a series of incentives for the same. We are quite appreciative of the initiative taken by and the vision of the NCT government, which was quite evident through the scheme.
Although the policy has its merits, we feel that certain issues and problems in the policy were overlooked in the long process of drafting. As involved citizens and representatives of stakeholders in this scheme, it is our duty to point these out to the government for smoother implementation of the scheme. It is also our duty to suggest potential measures to tackle the aforementioned issues and strengthen the scheme.
The suggestions mentioned below focus on both incentivising on-boarding EVs as well as disincentivising the usage of other fuel-based vehicles over a longer period of time. Our suggestions, thus, attempt to make sure that aggregators and DSPs are unable to ignore the scheme at the cost of minor penalties while maintaining the health of the Transport Department budget. We have also included multiple suggestions to improve the implementation and plug potential loopholes in the scheme. We hope that these suggestions are considered and deliberated upon, and are honoured to be a part of a historic policy in the field of transportation.
Issues with the Scheme:
• The scheme ignores aggregators with less than 25 vehicles in their fleet, without creating a framework to include them into the scheme at a later stage. This opens the scheme up for potential loopholes in the longer run. [Clause 3.1]
• Vehicles on-boarded must face a larger punishment than two days of off-boarding if they are not able to meet the safety measures and standard set by the scheme. [Clause 6.3.vi]
• There is no time period mentioned for updating one’s disclosures on the app. This could lead to severe inefficiencies of disclosures as well as a lack of information to the consumers directly. [Clause 6.13]
• Cost analysis shows that the on-road price of 5-seater petrol/CNG/LPG cars is between the range of Rs. 6 lakhs to 11 lakhs. The on-road price of 5-seater EV cars is between the range of Rs. 9 lakhs to 14 lakhs. According to the scheme, 5% of the fleet must be changed. Therefore, an aggregator with 25 four-wheeler vehicles in their fleet (as is the minimum under the scheme) is expected to replace atleast 1.25 vehicles. This means that they are expected to make an investment of a minimum of Rs. 3.75 lakhs for EV adoption within the first six months, while making efficient use of the vehicles off-boarded. The scheme does not contain any specific subsidies for the aggregators for this investment, or any sort of a scheme or POA for the cars off-boarded by the aggregators. [Clause 6.21]
• There are around 2300 charging points in Delhi, according to the Delhi government. It takes, on average, around 8-10 hours to fully recharge an EV battery. In contrast, it takes less than 10 minutes to fill up the tank of a petrol-fuelled car. For aggregators, whose drivers often make their money from time-constricted trips for taxiing passengers and even goods, charging one’s battery will be unfeasible for them to do so on a daily basis during their active hours. Thus, incentivisation is necessary.
• The same issues stand true for Delivery Service Providers (henceforth, DSPs). [Clause 8.4]
• Three unanswered grievances in a month, without considering the nature of the grievances, seems to give the aggregators or DSPs a huge leeway. [Clause 10, sub-clause iv]
• The fees for registering cars are not enough as disincentive for aggregators to voluntarily switch to an all-electric fleet. [Form 2, Section (d)]
• There are no registration fees for any diesel-fuelled vehicles on road, which cause similar (if not more) pollution as a petrol-fuelled vehicle. [Form 2, Section (d)]
Suggestions:
• Making FAME-II benefits viable for the purchase of every new EV which will be on-boarded will incentivise aggregators to reach the goals set out in Clause 6.21.
• In attempts to boost on-boarding numbers and further incentivise the transition, we suggest increasing the FAME-II benefits by 30-50% in every class of vehicle only for aggregators and DSPs registered under the act. To protect the budget of the Transport Department, we suggest these increased benefits to be opened only for the first two cycles of on-boarding as mentioned in Clause 6.21 (i.e., for one year).
• Further incentivisation programs, including but not limited to ex-showroom discounts on certain electric cars, reimbursing SGST, or adding income tax benefits for aggregators, to make acquiring new assets more fiscally viable for aggregators will be vital to reaching the goal set out.
• Potential tie-ups between the Department of Transport of GNCTD and top insurance firms in Delhi to subside insurance premiums will ensure the reduction of on-road price of the new assets on-boarded.
• A step to ensure safety will be to create a new task force within the Delhi Police Cyber Cell, working closely with the CERT-In, to ensure security of personal information on aggregator-created apps, and investigating any complaints/reports/allegations of app-related criminal activity.
• The prerogative to check for app vulnerabilities must be on the app developers, but it should be done in the knowledge of the government by either a government-approved cyber security firms or CERT-In. [Clause 6.11]
• Creating a subsidy facility for retro-fitment of vehicles qualifying for retro-fitment will be ideal. This would ensure that most vehicle off-boarded due to their fuel type can be converted into electric vehicles (upon approval as per rule 47A of the CMVR, 1989).
• Such a policy could include awareness drives about retro-fitment, free checks for aggregators and delivery service providers to see if their off-boarded vehicles qualify for it, expediating Form 22-C Part I filled out by aggregators and delivery service providers, and/or subsidising the cost of retro-fitment through immediate price discounts or through tax benefits on such vehicles.
• The registration fees for CNG- and Petrol-based vehicles should be incrementally increased over the period assigned to fleet conversion in Clause 6.21 and 8.4. This measure ensures increased disincentive relative to the period of time that the aggregators and delivery service providers have had to move to an all-electric fleet.
• Post-moratorium period, there should be a monetary penalty per vehicle that the licensee has failed too on-board. For example, if a licensee fails to meet the conversion target by 2 vehicles, they should be required to pay an additional fine per car. However, upon paying the fine, the aggregator must be allowed to continue operations with the fleet that they have till the next target period ends.
• The aforementioned fine must be higher than the registration fees of the highest bracket of the type of vehicle.
• Post April 2030, the fines imposed upon the aggregators should not be a one-time payment, but a periodic fine to be filled after every three months. The fine shall be incrementally increased within the range mentioned under Clause 10.iii, and shall be imposed only after an inspection by the concerned authorities.
• A framework should be added to the document for aggregators with under 25 vehicles in a fleet, making the provisions of the scheme applicable to then with effect from May, 2030. They would be required to register their fleets and reach similar targets within the same time periods.
• To make identification of commercial electric vehicles and all-electric fleets easier for consumer, we suggest creating a new color of numberplate for the vehicles on-boarded in such fleets. Potential color schemes can include purple background with white lettering, orange with black letters or maroon with white lettering.
