India’s chaotic public transportation system could be in for a major overhaul, with federal think tank NITI Aayog beginning work on a national framework for first- and last-mile mobility, according to two people aware of the development and a document reviewed by Mint.
The move is significant given the scale of reliance on informal transit: an estimated 200–300 million Indians depend heavily on privately run rickshaws, tempos and minibuses for last-mile connectivity, with most tier-II, tier-III and smaller towns having limited public transport.
The framework is to be finalized by a nominated committee of transportation sector experts, as well as officials from the ministries of road transport and highways, and housing and urban affairs, according to one of the two people cited above, who requested anonymity.
“The target for this committee, headed by a NITI Aayog official, is to prepare a report in the next three months,” this person added.
The second person cited above said that the move was prompted by the fact that there is currently no formal framework for a transport system widely used by the public. “The committee will try and figure out what can be done about establishing an oversight into this informal system of transport, which is growing rapidly,” the second person said.
The document reviewed by Mint showed that government-run systems are available in just 66 of 496 Indian cities with populations above 100,000. This forces commuters in most urban centres to rely on informal, and often unregulated, local transport networks.
The consequences are visible across cities. India's latest economic survey for FY26, citing studies by various domestic and foreign organisations, noted that traffic congestion is a serious issue in Indian cities, often leading to loss of productivity, and consequently, income.
“Effective treatment begins with identifying the underlying issue—a growing dependence on private vehicles,” the survey said.
The environmental cost is equally significant. Petrol and diesel vehicles accounted for over half of India’s total automobile sales of 28.3 million units in FY26, contributing to rising urban air pollution. In New Delhi, for instance, air quality frequently crosses 400 on the air quality index during peak winter months.
Further, the national capital also suffers from last-mile gaps, with an estimated 200,000 electric rickshaws registered as of early 2026, ferrying commuters to and from metro stations and bus stops.
India’s last-mile mobility vehicle market—comprising three-wheelers, tempos and minibuses—annually records sales of 1–1.2 million units, with passenger three-wheelers accounting for roughly 80% of the segment.
Queries emailed to the spokespersons of NITI Aayog, and the ministries of road transport and highways, and housing and urban affairs on 17 April remained unanswered.
The importance of the last-mile transport options becomes even more stark considering that metro rail systems—which were expected to deliver an affordable, always-available option of transport—are operating at suboptimal capacity.
A 2023 Indian Institute of Technology (IIT) Delhi study found that all metro systems operating in Indian cities have 25-35% of their projected ridership.
“A streamlined policy framework among urban planners, developers, transport systems, and the government can lead to increased public transport usage, which is the need of the hour because urban roads are clogged with traffic,” said Sharif Qamar, associate director of transport and urban mobility at The Energy and Resources Institute (Teri), a new Delhi-based think tank.
“For instance, in Delhi, there are feeder services and para transit services, such as Gramin Sewa and e-rickshaw, to take commuters to nearby metro stations, but there is no regulation on boarding/deboarding points or vehicle standards for these services,” he said.
Qamar added that regulated pickup and drop zones, and even cycle parking services on metro stations could reduce traffic congestion and encourage people to shift to cleaner modes of transport.
According to urban planning consultants, a reliable last-mile mobility system around existing public transit only adds to the convenience of commuters in expanding urban areas.
“Take the Delhi-Meerut RRTS. It takes you from the national capital to Meerut in about an hour. So, the public transit infrastructure is there. If you add effective last-mile mobility to the system, it opens up a lot of opportunities in developing urban areas,” said Rajeev Vijay, executive director of government and infrastructure advisory at Knight Frank India.
Vijay added that while a policy framework for paratransit is welcome, it should take into consideration that urban transit and urban local bodies have a limited sphere of influence, and that the policy framework should consider all ecosystem stakeholders and particularly not impact the viability of service providers.