American multinational transportation company Uber is planning to enter the Nepali market. It is expected that this will increase competition in the Nepali market, which already has enough ride-hailing companies.

This company has been providing ride-hailing services including courier services, food delivery and material transportation worldwide.

Uber, the world's largest ride-sharing company, has more than 202 million monthly active users and 10 million active drivers and couriers. Uber operates in about 70 countries and 15,000 cities worldwide.

At least four sources familiar with Uber's possible entry into Nepal have said that the company is coming to Nepal. According to the sources, the company headquartered in San Francisco plans to enter the Nepali market within a month.

A few weeks ago, Uber officials met with representatives of some ride-hailing platforms operating in Nepal and some businessmen. In this context, they indicated that they could enter the Nepali market within a month.

An official of a ride-hailing platform, speaking on condition of anonymity, said that the company had been trying to enter Nepal since 2016. “But frequent changes in the government and the understanding of ride-hailing services in Nepal’s administrative machinery remained limited. As a result, they did not enter the market.”

Nepal allows foreign investment of up to 70 percent of the total share in ride-hailing services. Uber is looking for a Nepali partner as a minimum 30 percent local investment is required to set up a company in Nepal. The Department of Industries said that Uber had not submitted any application as of Friday.

“We have also heard that Uber is coming to Nepal,” said Prashant Bohara, director of the Foreign Investment and Technology Transfer Branch of the Department of Industries.

In recent years, rules and procedures have been relaxed in Nepal to attract foreign investment. Earlier, foreign investors had to invest a minimum of Rs 50 million in any business. Now the investment limit has been reduced to Rs 20 million.

IT projects have an even easier system. Here, permission to operate a business can be obtained without a minimum limit.

Although Uber's entry into Nepal is welcome, experts say the ride-hailing market is not large. 'Only three to four ride-hailing platforms can be a sustainable business in a market like the Kathmandu Valley,' said an official of a ride-hailing company. 'Competition is good for consumers, but sustainability remains the main question.'

There are about 30 ride-hailing services in Nepal, including those that provide cargo services.

The popularity of ride-sharing platforms is growing in Nepal due to the lack of reliable public transport. The increase in the number of platforms has led to intense competition in terms of service, quality and pricing. 

‘Uber has been conducting a market study for the past three to four months to enter the Nepali market,’ said a government official. 

Despite several court orders, there has been a delay in formulating laws regulating vehicle services in Nepal.  However, experts say that the government is now preparing to implement interim standards for vehicle services. 

According to an official, the Department of Transport Management has prepared a draft of the Digital Mobility Service Operation Standards 2082 and sent it to the Ministry of Physical Infrastructure and Transport for further discussion two weeks ago.  If these standards are approved, they can be implemented within the next two weeks, officials said. 

‘We started drafting the norms after the Supreme Court ordered the regulation of the ride-hailing business,’ said Ganeshman Rai, the department’s information officer. ‘Once the ministry approves the draft, we will implement it through a public notice.’

Despite the rapid growth in ride-hailing services, the government has repeatedly delayed enacting laws to regulate the sector.

On 29 Falgun 2076, the Patan High Court had ordered the government to bring ride-hailing services under the ambit of regulation. Six years later, little progress has been made. In January last year, the Supreme Court pointed out the need to enact laws to ensure regulation of the expanding ride-hailing companies.

‘Many international and domestic ride-sharing platforms have been operating in Nepal for years, but the current transport laws cannot address this sector,’ Rai said, adding, ‘The draft standards aim to regulate and streamline these services.’

The proposed framework expands on the traditional ride-sharing definition to include concepts such as ride-hire and ride-pooling. Rai said the draft has been prepared to improve safety and technological integration in the transport sector. 

Its key provisions include measures for passenger and driver safety. Such as social security for drivers, mandatory CCTV systems and GPS tracking in four-wheeled vehicles. 

Ride-hailing services have grown rapidly in Nepal, especially in Kathmandu.  Various companies estimate that more than 200,000 riders are active in this sector.  However, delays in policy implementation are also causing various obstacles. The government's policy and program for 2078-79 promised to introduce a ride-sharing law, but the Office of the Auditor General has said that this commitment has not been fulfilled.

Both international and domestic platforms are currently operating in Nepal. Major international platforms include Pathao, InDrive, and Yango. Local services such as JumJum, Sajilo, and La Basam are also active.