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Startups could soon get to try out novel transport models in cities under so-called regulatory sandboxes to live-test promising services, as the government bets on innovation in mobility to ease urban congestion.

This will be similar to the central bank recently proposing such sandboxes for the fintech sector to introduce new products in a limited environment, without a wider and expensive rollout.

“We are ready to provide a regulatory sandbox to any company that comes with a better (transport) model and help them to fine-tune their model. We will ensure that regulation does not kill innovation," road transport and highways secretary Giridhar Aramane said in an interview.

The government is open to the idea of startups or companies introducing fresh mobility models beyond cab aggregation which has already become established over the last decade.

“We are willing to look at that. Innovative models will be given a chance to experiment and mature in a limited space and time," he explained.

His comments come against the backdrop of the government introducing national guidelines to regulate vehicle aggregators. While cab aggregation has become popular, car pooling, bike taxi and other micro mobility options offered by startups are also gaining popularity.

Experts said a regulatory sandbox will need the involvement of both the government and the industry as new technology and business models will have to be tested in the transportation space. While there can be one common idea, implementation will have to vary from state-to–state depending on mobility requirements.

Ola Mobility Institute, a think tank set up by cab aggregator Ola, said that India needs to implement artificial intelligence and new technology-based mobility innovations to improve road safety, efficiency and build sustainable mobility systems.

“The government could take the lead in framing a regulatory sandbox similar to one adopted by Reserve bank of India for the fintech sector. These guidelines may specify objectives, eligibility criteria, areas of application, implementing department, role of central and state governments, criteria for evaluation and process for scaling up of successful innovations. A regulatory sandbox approach would help industry to test and scale new technologies in collaboration with regulators in a controlled environment before scaling up," as per Ola Mobility Institute spokesperson.

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