Changing the goods transport paradigm with autorickshaws

As India's cities grow more digital and delivery-driven, the pressure on urban logistics is steadily rising. Yet navigating India's dense, informal, and congested urban fabric requires a kind of fleet that is both agile and affordable. Passenger autorickshaws may be considered here. Many autos are underutilised for much of the day, operating mainly during peak hours. Drivers, often earning inconsistent incomes, use off-peak hours to carry small parcels in informal arrangements. The vehicle is there. The demand is there. What is missing is the regulation of the service through a transparent policy guideline.

- Jagadish Shettigar

Currently, most passenger autos operate under contract carriage permits that prohibit the transportation of goods. The Motor Vehicles Act includes an exemption for vehicles under 3,000 kg from needing a separate goods permit. However, this clause is interpreted and implemented inconsistently across states. While some allow dual use under defined conditions, others require prior approvals or offer no guidance at all. The result is a regulatory grey zone where informal practice outpaces formal policy.

According to urban freight studies from the Centre for Digital Economy Policy Research at IIT Delhi and the World Resources Institute (WRI), dual use could raise utilisation by 30-50% and increase monthly driver income by ₹3,000-5,000. For small merchants, access to nearby, affordable delivery options could lower logistics costs and expand their service reach.

A 2023 WRI study found that using passenger autorickshaws for small goods delivery costs nearly 50% less than using dedicated three-wheeler cargo vehicles. Even if just 10% of India's estimated $40 billion urban and last-mile logistics market loads could be shifted to autorickshaws, the potential savings could exceed $2 billion annually. These savings would be shared across drivers, merchants, platforms, and of course, the end-users.