Why Are Auto Rickshaws Such a Pain for Everyone?

Commuters everywhere complain about greedy auto drivers. Auto drivers, though, also complain that they are being exploited. What is the truth and where does the money go?

In the frenzied run up to the Delhi assembly elections in November this year, what is the likelihood that the ruling Congress party would insult a population of more than a lakh workers and call them "uncivilized"? Highly likely, it turns out, when the constituency is that of auto rickshaw drivers and the party feels assured of the support of both the middle classes and the media.

In the last few months, the Aam Aadmi Party has cannily involved Delhi's auto rickshaw drivers in its political campaigns: autos have ferried party members, delivered petitions and carried AAP campaign posters on their backs. There are currently about 70,000 autos in Delhi (the precise number is unknown), which means about 1.2 to 1.3 lakh auto drivers in the city (since most autos are driven for two daily shifts by different drivers). The fledgling party appears to be mobilising Delhi's auto drivers as a voting block, much to the disdain of the ruling Congress which has described the use of auto rickshaws as "uncouth" and "uncivilised" and is trying to block the posters in the High Court.

"When the AAP forms the government," claims AAP spokesperson Gaurav Singh, "we will build auto stands, stop vehicle impounding, focus on training with a view to reducing refusal and overcharging, eliminate the finance mafia and introduce financial benefits for auto drivers. AAP will ensure the emergence of strong unions which truly represent drivers."

Called "uncivil" by the ruling Congress, it is little wonder that Delhi's autowallahs have embraced the AAP simply because the party has sought to understand their actions, rather than simply reflect the public mood by lambasting them. "The AAP acknowledges that auto drivers have genuine grievances," says Rakesh Agarwal, founder of the auto-rickshaw social enterprise Nyayabhoomi (and the city's top authority on the auto-rickshaw sector), which is supporting the AAP; "as yet the party has made no grand promises, but its efforts to understand the suffering of the driver has earned it their support. Arvind Kejriwal has issued an open leaflet to drivers outlining the issues and how the AAP will tackle them when in power."

The auto drivers will have to wait to see post-elections whether their hardships are quickly forgotten or whether their support for the AAP will lead to real policy changes that break the ladder of exploitation.

While the establishment sees the auto driver as a new and unwelcome intruder into the political arena, to the average commuter these drivers are a regular and unavoidable source of aggravation, frustration and rage. Consistent complaints about drivers imply that it is also often rather difficult to live with them. But the critical role of the auto in transportation across urban India means that, for the middle classes, it also remains hard to live without them.

Our Back Seat Driving

The complaints against auto drivers are so familiar to most of us, it seems unnecessary to go into them. For form's sake, though, let us reiterate that in most major Indian cities, the two consistent complaints about auto drivers are that they overcharge and they refuse passengers. Their meters are often broken, tampered with or simply never turned on, forcing the passenger into bad-tempered haggling on the road. If a mutually acceptable price proves elusive, the driver just speeds off.

Despite the brevity of these encounters, they instil a sense of frustration and often outright anger in the passenger. The commuter, late for work and paying more than the meter rate, asks herself, "Do I need this hassle every morning? Do I really need to deal with these hooligans and their attitude? Won't someone do something about them?"

Commuter organisations such as Meter Jam have been trying to do just that. Meter Jam's website paints a picture of Mumbai's auto drivers "holding the janata to ransom" with their tampered meters, arbitrary refusals and petulant strikes. It appeals to commuters to unite, "turn the tables" and "fight back" by boycotting autos on certain days.

Similar adversarial sentiments are echoed by several anti-auto Facebook groups such as I Hate Greedy Auto Rickshaw Drivers of Bangalore and Auto Rickshaws Unruly, and petitions like the auto rakshas petition on Change.org which depicted Bangalore's auto drivers as horned demons. All share the attitude that these drivers are an adversary to be fought directly with boycotts and increasingly stringent regulations. (Meter Jam did not respond to requests for a comment.)

The Congress labelling auto drivers "uncouth" is consistent with the media's similar vilifications of this profession. Coverage of auto rickshaws in the English-language newspapers frequently abandons objective journalism and instead echoes public sentiments with rather emotional reporting.

"The administration has succumbed again," laments one journalist covering a rise in the meter rate in Jaipur, it has "bent over backwards" to please "erring auto drivers who fleece the passengers by charging over what the meter reads." Drivers stand accused of "fleecing" customers in Kashmir where the authorities are accused of turning a "Nelson's eye" to their misdemeanours, to Tamil Nadu where drivers are said to prey on vulnerable hospital patients. For the press, auto drivers are an urban bogeyman whose misconduct justifies dropping the conventions of balanced reporting and going on the attack.

These articles about auto drivers often snowball when commuters take the opportunity to share their frustrations in their respective cities. Auto drivers are "the biggest crooks in Delhi", "a virus" in Chennai, a "mafia gang" in Bangalore and "corrupt" by nature in Mumbai.
News reports also provide a chance for angry commuters to share experiences with those in other cities: "Auto drivers in Tamil Nadu, especially Chennai, are pioneers in fleecing and looting their customers," says one fed-up Chennai resident commenting on a story about overcharging by Delhi auto drivers. Autos in Kerala are "a nightmare," says another to express everyone's common frustrations.

Policy makers have generally responded to these accusations with improved complaints mechanisms - Delhi and Bangalore police now take complaints against auto drivers via SMS and social networking sites - and regular police crackdowns against overcharging, refusal to ply and other misdemeanours. But following up on thousands of complaints is a tough task for the police and accosting drivers red-handed also proves difficult.

The adversarial attitude of commuter organisations and the ever stricter regulations conjured up by policy makers assume that the root cause of overcharging and refusal is the driver's own individual greed. The situation is regarded as a zero-sum game - the way to make things easier for commuters is to make life harder for drivers.

But those who assume that overcharging is caused by greed all too often duck an important question: Do naturally greedy people gravitate towards auto driving as employment, or is there something about auto driving that makes individuals act greedily? And if the latter, then what exactly?

On the Road, Every Day

Jai slowly sips his chai as he explains his predicament. Back in 2002, the 50-year-old father of three from Delhi had grown tired of renting his auto from a large contractor (his malik, as Jai calls him) who owns dozens of autos.

Today, auto drivers in Mumbai make about Rs 500 a day, around Rs 650 in Chennai and Rs 750 in Delhi. But this money doesn't stay in their pockets for long. The cost of CNG, LPG or petrol eats up about a quarter of the income.

Some inevitably finds its way into the pockets of the traffic police. Then, after a sweaty 10- to 12-hour shift on a rock-hard seat, breathing in the city's traffic fumes, most drivers must hand over around half of their total income to their maliks as rent (around Rs 250-350) - leaving them with Rs 100-200 to take home to their families every day, sometimes less, or even nothing at all if the traffic police demanded a larger bribe than usual that day.

After years of parting with a big chunk of his income every evening, it's not surprising that Jai saw ownership - getting rid of the malik and his rent demands - as the only way to increase his earnings. He would work hard, pay off the loan quickly and start taking home the bulk of his total daily revenue. A sensible plan.

Keen to get his own auto, Jai went to one of the city's numerous auto 'financiers' who sold him a second-hand auto and an auto permit. He even provided the loan for three-quarters of the money, repayable in monthly instalments (similar to Jai's rental costs per month).

But ownership proved difficult: the fuel costs were the same, as were the bribes to the police, but Jai was now hit with monthly maintenance bills of around Rs 1,000 which had previously been the malik's responsibility. He was now also obligated to grease the palms of officials processing the auto's paperwork. All the while, escalating inflation was pushing up his family's living costs.

Eventually, Jai's finances cracked. He missed several of the monthly repayment deadlines set by the financier. The late payment penalties were so severe and the interest rate so high (18 percent) that he is still paying off the loan over a decade later. His name is still not on the all-important permit document, which means he does not yet own the auto outright.

How could he have known all this, he wonders now, since he is illiterate. Although literacy would have been of little use as some of the contracts he signed were blank. "Kya karein? (What to do?)" he shrugs his shoulders in resignation. The blank contracts may have been since sold to another financier - a common practice. The new buyer simply writes in his own terms and conditions, upping interest rates, monthly payments and late payment penalties at will.

Nandu's financier did not even bother to sell the contracts. One day, the middle-aged Madhya Pradesh-born driver in Delhi found that his financier had arbitrarily increased the price upon which they had agreed and was demanding higher monthly payments.

With little power to refuse, Nandu borrowed from his landlord and went through a long and torturous process, which included physical assault by the financier and his mob, before he finally got hold of the permit and registration documents for the vehicle. However, the burden of repaying his inflated loans means that he now cannot provide three meals a day for his wife and two sons.

In short, getting your hands on your own auto is relatively straightforward, but paying off the loan for it is a different matter. This is evident in the levels of auto renting: Approximately 80 percent of drivers in Delhi rent. The figure is roughly 75 percent in Mumbai, 70 percent in Chennai and 60 percent in Bangalore.

While each city has its own dynamics, the auto rickshaw sector shows some consistent traits across urban India: high barriers to entry, lack of formal credit, a reliance on informal financiers and considerable unofficial costs. Sorry stories such as Jai and Nandu's are common.

Formal bank finance is of limited use to auto drivers like Jai and Nandu: they seldom have the myriad of supporting documents needed to apply for a bank loan. And if they do manage it, then the bank will only finance new autos and is blind to the 'unofficial' costs of getting an auto on the road.

One such cost is the permit. In order to tightly control the number of autos on their streets, Delhi, Bangalore, Chennai and Mumbai restrict the number of auto permits. The supply bottleneck, coupled with the burgeoning demand for auto rickshaws in these exploding cities, has turned a simple piece of official paperwork into a lucrative black market commodity that brings in cash for a shady networks of financiers, agents and their contacts inside the bureaucracy.

A Chennai auto permit (official cost Rs 375) may actually set a driver back between Rs 70,000 to 1 lakh. A Bangalore permit can cost anywhere between Rs 12,000 to 35,000, depending on whether it is new or an old one being transferred. Permits in Delhi change hands for anything up to Rs 4.5 lakh. In contrast, a new auto costs Rs 1.3 to 1.6 lakh.

But this still doesn't clear up why auto drivers overcharge. The meter rate covers all these costs, doesn't it? It should, since it keeps rising! The situation is, as ever, slightly more chaotic.

Every year, Transport For London calculates the city's black taxi cab fare based on a formula agreed upon by the authorities and the industry. In India, there is no set formula for calculating the meter rate for auto rickshaws and no timetable for revision. Hastily formed fare committees come up with a different formula each time the meter rate is recalculated.

These committees are formed only when the meter rate becomes so out of sync with living costs that overcharging becomes standard and union agitations unbearable, ending in auto strikes that put overworked bus and rail networks under additional strain. Fare calculation then becomes a loud, political process. Arguments erupt amongst the authorities, political parties, auto unions and consumer organisations.

 Unsure as to when the next revision will happen, unions push for the biggest hike possible, despite public animosity. The final fare revision often has more to do with politics, alliances and vested interests than the daily realities of earning from an auto.

But higher meter fares prove to be only a temporary benefit for drivers. Fuel, maintenance and food cost inflation move at their own pace. On the other hand, auto rents and permit prices climb quickly in reaction to the latest meter hikes, creaming off the additional revenue for the maliks and financiers. All this makes the new meter rate obsolete in a matter of weeks and leaves the drivers back where they started: overcharging their passengers in order to pay maliks and financiers - robbing Peter to pay Paul.

Auto drivers find themselves stuck on the first rung of a ladder of exploitation. As they are increasingly exploited by those on higher rungs, so they must they exploit their sole source of income, their passengers. The drivers are merely conduits for money that flows through them. Very little sticks.

Policies to tackle overcharging also end up exacerbating it. For example, Delhi's GPS policy - which makes GPS systems, panic buttons and receipt printers mandatory in auto rickshaws - includes an annual fee of Rs 7,500 to Delhi Integrated Multi Modal Transport Systems (DIMTS), the company with the supply contract. This money comes out of drivers' pockets in the form of direct payments (for owner drivers) or increased rents (since the maliks refuse to foot the bill).

The GPS system, which still remains non-operational, is supposed to decrease the driver's ability to overcharge. The commuter's (and in turn, the policy-maker's) desire to rein in the auto driver inadvertently increases the latter's incentive to ask for more by adding a fee of Rs 7500 to his annual expenditures, further tightening the screw on his finances. The policy targets the drivers but leaves the maliks and financiers untouched.  

No auto driver enjoys overcharging; most say it makes the job a misery, but time and time again their hand is forced by the money being extracted from them. For drivers the status quo is intolerable, yet some recent reforms have made their work even harder.

Balbir Singh, an auto driver in Delhi, admits to overcharging his customers. The meter fare just does not cover the rising cost of living, he says. He was recently hit with a bill of Rs 19,000 for a new meter. "Rs 19,000 main to plasma TV bhi aajata hai, ek bada fridge bhi mil saktaa hai (Rs 19,000 can get you a plasma TV or even a big fridge)," he says. Singh bought his auto rickshaw through a financier and then had to return to him for an additional loan for the new meter.

Every spare rupee he can extract from passengers goes to the financier. But if drivers are so financially pressured, then why do they also keep turning down customers? Why do they sometimes seem to refuse to go anywhere?

Sometimes, a journey costs the driver more money than the passenger realises. For example, if you want to go to an isolated destination such as a lonely housing colony 10 km away, this usually means that after dropping you, the driver will have to return to where he picked you up in order to find another customer. This means that he will drive 20 km in total, burning costly fuel. But he will only get paid for 10 km. Knowing that no passenger is going to pay double the (already pinching) fare, the driver simply refuses to engage with you. He can't afford to burn 20 km of fuel for a 10 km fare.

But the situation is not entirely hopeless. There are ways to make auto rickshaws work for both drivers and passengers. One good example is in Ahmedabad, where G-Auto has been operating an auto rickshaw service since 2009. Set up by a public charitable trust called the Nirmal Foundation, G-Auto runs a 10,000-strong fleet, a telephone booking facility, driver training programs and uses numerous customer feedback mechanisms to ensure high service standards. It also offers drivers health insurance and an allowance for their children's education. The service has eradicated overcharging and refusals-to-engage for passengers and at the same time increased the drivers' incomes.

While founder Nirmal Kumar talks of "social and financial upliftment", "safety and transparency" and making drivers "responsible citizens", the key to the project's success seem to lie elsewhere: G-Auto also provides formal bank credit to drivers wishing to buy an auto rickshaw. And it provides autos the backing of the authorities.

Formal credit allows drivers to escape the malik's daily rent demands and circumvent informal financiers with their high interest rates and ever-changing repayment conditions. Official support protects the service from unexpected policy shocks (that wreck drivers' finances), police harassment and petty palm-greasing at the local Transport Department and Regional Transport Offices.

The tiny minority of drivers in initiatives like G-Auto enjoy access to credit and freedom from ever more stringent and costly monitoring policies. They suffer little official harassment. They become free from the necessity of overcharging and are unaffected by the loud, antagonistic debates about fare raises. Their income is assured.

The success of G-Auto suggests that the genuine way of tackling the problems with autos everywhere is fixing the root causes rather than endlessly debating meter fares. This seems difficult given the hostile attitude of the middle classes, the media and politicians. But this is what will rescue the drivers and, in turn, commuters from their particular road miseries.

With additional inputs by Anjali Alex and Kriti Johri.

Simon Harding is a writer and researcher. He is currently pursuing a PhD at the University of British Columbia, Canada focusing on public transport in Indian cities.

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