Transport service closure
Middle-class Pakistani often rely on the transport services of Uber and Careem to commute within their respective cities. This is because there are no other decent alternatives available. Local transport systems remain dilapidated with ramshackle vehicles that have a high carbon emission rate and are a safety hazard. Hence, local start-ups and international organisations have identified and tried to fill in this gap by providing the necessary services.
Not only are these organisations important for commuters as travel has become a cumbersome task, but encouraging such companies will immensely benefit the economy by generating much needed revenue. However, global tensions, economic disruptions, hike in oil prices and lack of incentives have not created a flourishing environment. We recently saw the shutdown of services such as airlift and others, while Uber managed to acquire Careem for a whopping $3.1 million deal.
Now, even international companies are finding it difficult to cope with the deteriorating socio-economic situation as Uber has recently announced ceasing operations in Karachi, Multan, Faisalabad, Peshawar and Islamabad and will be only working under their subsidiary company Careem. This will indeed lead to much frustration among the middle-class and this is why not only will this decision lead to unemployment but it will also increase demand as less cars will be available to meet requirement. The high demand means that prices of rides — that have already sky-rocketed due to a surge in petrol prices — will increase even further, making it hard for the lower-middle-class to afford such services.
Apart from giving fuel subsidies to the poor, the government can provide transport startups with incentives to launch operations in mega-cities. On the other hand, officials can also work towards developing the local transport system just as they are doing so in Karachi with the red, green and orange line. The right to freely travel must be safeguarded while considering the economic woes of Pakistan.
Published in The Express Tribune, October 15th, 2022.
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