India’s growing oil imports, reaching 232 million tons in 2022-23, pose significant risks to the fragile ‘atmanirbharata’. Domestic oil production accounts for only 13 per cent of consumption, and efforts to reduce oil imports, such as incorporating 20 per cent ethanol into petrol and switching to electric cars are insufficient. The dominant growth on roads will come from private cars and two-wheelers using auto fuels. The policy does not contain a serious solution to reduce oil imports, and it is too late to achieve the Paris goals of net zero emission outcomes before 2050
Demand side solutions for improving passenger transport in India can be adapted from smart capitalist countries like Japan, Singapore, Britain, and China. These solutions should focus on encouraging commuters to prefer public transport, making railways faster, convenient, and affordable, and implementing dedicated freight corridors for goods transport. Longterm goals include using bullet trains and short-term Vande Bharat trains, which use clean and cheap electricity, are cheaper to build and operate, and are more flexible than highways. Reducing oil imports and reducing oil prices could increase the country’s status as a global economic power.
RATIONALISE TAXES/ TOLLS FOR ROADS IN MILLION+ CITIES
We talk about promoting public transport, but if you look closely, taxes on buses are much higher than private cars, which pay on purchase only once at six to 12 per cent of the total value. On the other hand, buses pay taxes annually, depending on whether they are air-conditioned, deluxe etc. In their entire lifetime, buses pay more than 50 per cent of their value in taxes.
So, why can’t we make taxes payable once every five years for both cars and buses at the ad valorem rate of 28 per cent for cars and eight per cent for buses? Those who believe that these rates are usurious, look at what Tokyo and London do. There is an annual tax of more than US$400 in Japan and US$ 150 to US$ 200 per annum in London. People who buy cars belong to the top 12 per cent of the population and can easily afford this tax, which is the cost of roads required for cars (we should make efforts to meet the standards of roads). Also, it is the only way to persuade people to buy fewer cars while simultaneously improving the bus and train services and timing as well.
Similarly, the parking fee should reflect the value of the road space. But we need to tackle this issue with political determination. It is not possible for us to insist on a private parking space for all cars. This will provide freedom for people as only those who can afford the space required for cars, can use it. Those who can’t afford this can have taxis, and those who can’t afford taxis can use substantially improved public transport in the cities. When we remove a lot of kerbside parking, we can get a lot of space for bus lanes which will improve frequency, speed, comfort and convenience. Additionally, there should be fair pricing for all modes, particularly for public transport to make it affordable. This will reduce the number of cars on roads in cities as there will be no free and careless parking, making space for bikes and e-bikes.
SHIFT TO PUBLIC TRANSPORT MEANS LOW FUEL IMPORT AND EMISSIONS
This will facilitate better buses with lower fares and at higher frequency of all AC and non-AC buses. Introducing bus lanes can increase the speed and help cut travel time substantially with little additional investment. What is required can be financed through higher taxation on new cars. As mentioned earlier, bus tolls should be significantly lowered, while car tolls should be raised to encourage a shift from cars to buses.
Lastly, cities with a population over one million should introduce tighter control over free parking to reduce the number of cars on roads. These adjustments in tax rates and tolls, favouring buses over cars, will increase merit revenue which can finance other capex identified above to improve other sustainable projects. The high-speed rail projects and dedicated freight corridors significantly reduce the import of oil together with reduced emissions and faster and affordable mobility below the top 20 per cent of the population will achieve ‘Sabka Saath Sabka Vikas’ and will have positive effects accelerating inclusive growth.
REGULATED AND PAID PARKING IN MILLION+ CITIES
Using semi-high-speed trains and electric air-conditioned buses can be a viable alternative to cars or even air travel for distances up to 500 km. France has introduced ‘No flights within one-hour rail distance’ to discourage expensive and highly polluted air travels. It is appalling that we have allowed cars to grow mainly in million-plus cities and not having any worthy parking policies is a shame to all our leaders and municipalities.
Before this problem gets out of control, let us put brakes in the form of restraints by implementing higher tax – 25 per cent instead of six or 10 per cent and “either pay or don’t park” policies for congested cities. Revenue from this is a by-product. It will bring a real understanding of the scarcity value of urban land which we realise while building houses and flats. Out of 20 lakh cars in the metro city of Mumbai, half of them are parked on roads occupying 20 cr sq ft of valuable urban space that is used for free. Is it fair? We don’t want to ask this gigantic question. But we need to adopt a capitalist solution like everything else. This will benefit 80 per cent of people who don’t own cars.
TRUE WISDOM
It is time to strike the right balance with a greater emphasis on semi highspeed trains and the establishment of sustainable transportation for all citizens of India, not just the 20 per cent who own cars. This shift will lead to a balanced and sustainable transportation system over the next 15 years, benefiting air quality and overall development. These reforms will not only provide faster, cleaner, and more affordable energy, but also reduce our dependence on imported oil, leading to a sustainable decrease in our oil imported bill which in turn will help us boost our foreign exchange reserves.
This analysis is driven by energy economics and efficiency, including the use of time. The underlying figures supporting this perspective are correct but need official confirmation. By providing specific numerical details regarding the cost of electricity and fossil fuels per kilometre of trains and cars, as well as travel times for urban commuters, long-distance travellers, and goods transportation, we can make an even more accurate estimation of the benefit that we can derive from this Objective Driven Comprehensive Policy Framework. This approach aligns with the true meaning of “Gati Shakti,” emphasising the efficient utilisation of resources.