Delhi is sharply divided into camps in support of and against the odd-even formula for cars. The division is sharper than that based on ownership of odd and even number cars, since there are households without cars and others with more than one.
Also, many — those who use official transport, are single women, can travel before or after the stipulated time etc — would be unaffected. Nonetheless, everyone has an opinion on the formula.
Disagreement on the causes of the problem and implications of the solution notwithstanding, there are three postulates on which there seems to be near consensus. One, the traffic situation is desperately disconcerting in Delhi; two, air pollution levels are well beyond acceptable limits; and three, we must ‘do something’ urgently to improve public transport.
The first question is why a market solution, within the framework of a fiscal paradigm, cannot be tried out. This would involve increasing petrol and diesel prices, tax on the production, sale and purchase of cars, and user charges to cover not just the wear and tear of roads but also the cost of congestion and environmental degradation.
Democracy has serious limitations in accepting such straightforward solutions, even when the government has a massive mandate. The moment the ‘common man’ is touched, issues of legitimacy, corruption, accountability for tax money and so on are raised, not just in the media but on the street, with public assets often becoming the target of attack.
A technicality
If the government decides that it would like to avoid these issues being raised in public by avoiding direct or indirect taxation, it has to be understood and excused, given the current political context.
The formula can be strongly defended by putting forward the altruistic goal of protecting the environment, public health, creation of a model for others to adopt and thereby save the country and the world.
Generally speaking, there may be adequate justifications for opting for non-market solutions in India as an alternative, where questions of equity and distribution of benefits are crucial.
But on the issue of the restriction being imposed on car owners, the question of equity may unravel differently. This solution must, in fact, be considered regressive since those who have more than one car would have larger options and not be affected at all.
Also, those who would like to avoid illegal options and can afford to buy another vehicle (could be as high as 60 per cent of car owners in Delhi) would beat the principle behind the restriction.
Market solutions such as hiking the cost of fuel or asking road users with one car to purchase the right to use it on all days by paying a certain amount (and getting a second number plate officially), would make the government extremely unpopular.
The promise that additional resources so raised will be used to improve public transport is unlikely to cut ice with the “politically conscious citizens” of the country, who do not trust any government, irrespective of its colour.
Income and efficiency
Ironically, the issue of the impact on the State or national income has not been raised; the public debate has treated this as irrelevant. The assumption is that people will make the required adjustments so as to leave their contribution to national progress intact.
Or, possibly, it is assumed that if the babus, including bureaucrats, academics, civil society workers, reach office late and arrive exhausted by having used public transport, their work culture or outcome will not be affected.
Alternatively, it can be stipulated that reduced efficiency at work can have a positive impact on the State or national income.
If a similar assumption is made about workers in other activities, it would be reasonable to close down shops and business houses for three days in a week to resolve the traffic problem.
Raising taxes, user charges and so on provokes public debate and unrest on issues of governance. These can be safely pushed under the carpet if the government is not collecting any extra money.
However, if the policy comes into force, the capacity utilisation of all the vehicular capital owned by households will come down roughly to 55 per cent of the present level, unless specially exempted.
This means a loss of value of their productive asset by 45-50 per cent. That can easily be translated into a monthly loss of between ₹5000 and ₹15,000, depending on the price of the car and the use of the vehicle.
The mobilisation of resources through fiscal and financial measures needs legitimacy and credibility of governance, in order to convince people that the money collected will be used for the appropriate purpose.
The writer was dean of the School of Social Sciences, JNU
