Have you ever wondered why cricket matches are getting shorter – from test matches to one-day matches to T20 and now T10?
There are two possible reasons – either people can’t stand so much cricket, or it’s not cricket’s fault. Perhaps, people can’t stand anything for that long.
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Evidence suggests that the latter is more likely to be true. With a plethora of services and information to choose from, young Indians are falling short of one critical and finite resource – attention, cognitive space.
Herbert A Simon, a psychologist, economist, and Nobel Laureate, coined the term’ attention economy’. He noted that “a wealth of information creates a poverty of attention”.
In 1997, theoretical physicist Michael Goldhaber postulated that the international economy is becoming attention-based rather than material-based. Goldhaber added that while information is not scarce, attention is.
With shrinking cognitive spaces, consumers prefer door-to-door services and apps that reduce their active involvement in a task.
For instance, the proponents of autonomous cars support the idea with two benefits: crash risk reduction and commuter productivity. By outsourcing driving, commuters free up their cognitive space.
What is cognitive load, one might wonder?
Pioneered by Australian educational psychologist John Sweller in 1988, cognitive load theory suggests that the working memory of individuals can hold between five and nine chunks of information.
Sweller said that since working memory has a limited capacity, it shouldn’t be loaded with information that doesn’t directly contribute to learning.
Similarly, with the chaotic abundance of information and limited space in working memory, it is likely that, if given a choice, humans would outsource some of the “passive” and “lacklustre” tasks, such as commuting, to an app or another person.
This practice may be both good and bad for sustainable transport. On the one hand, commuters don’t want to go through the “nightmare” of finding a rickshaw for the last mile of their trip. On the other hand, driving on congested streets and finding a parking lot is a cognitive load.
However, this outsourcing varies across geographies and socio-economic backgrounds. For instance, a team of researchers from the University of Kentucky found that ride-hailing services have had a drastic impact on public transit use across the United States.
Whereas, in India, the impact of the ride-hailing platform is felt by the automobile sector, as shared by Finance Minister Nirmala Sitharaman in 2019.
In both cases, apps do take the cognitive load of ride-hailing off the commuter’s mind. They plan the trip from point A to point B, removing everything that goes on in between the trip.
However, considering ride-hailing apps to be a panacea to urban transport problems, such as congestion and pollution, might be myopic and even naïve.
According to the Union of Concerned Scientists, Uber’s ride-hailing trips resulted in nearly 69 per cent more climate pollution on average than the trips they displaced.
There exists a maxim in transport: “If everybody drives, nobody moves”. Most four-wheelers are not utilised to their full capacity. The average occupancy of a four-person car is just 1.15 person. If shared mobility doesn’t focus on increasing occupancy, it runs the risk of increased cognitive load in the form of congestion in the future.
A paradigm shift might be in order. Planners must stop pegging transport aggregator apps and public transport against each other. Indian cities need systems in which public transport and paratransit complement each other and are presented to users – Indian cities need MAAS (Mobility As A Service).
MAAS is the integration of various forms of transport services into a single mobility service accessible on demand. To cater to the commuter’s need, MAAS provides a diverse menu of transport options, such as public transport, taxis, car or bike sharing, and car or taxi rental.
For the user, MAAS can offer added value using a single application to provide access to mobility, with a single payment channel instead of multiple ticketing and payment operations.
MAAS shouldn’t be confused with on-demand mobility, where the supply and demand for transport are managed through feedback control, for example, Uber and Ola. MAAS entails integrated mobility solutions, often offered through subscription.
MAAS is the future for depleted cognitive capacities because it reduces the cognitive load of trip planning, multiple payments, waiting, parking, and congestion. With their working memory freed up, commuters can exercise agency on what they wish to put in their minds.
However, MAAS mobility is a long way off for India.
The challenges to the introduction of MAAS primarily pertain to regulatory barriers. For instance, even sustainable practices like motorbike taxis and carpooling are not legal in India.
Additionally, many businesses have tried to enter the public transport space, only to halt their operations due to the contract carriage versus stage carriage licensing dubiety.
Only if innovations like MAAS are encouraged can they be made safer for the public through regulation.
There exists a lack of coordination between the government and private players. A clearly-chalked-out data-sharing policy and revenue-sharing model can come in handy to make sure the two can work together.
First, government agencies need to define ‘public data’ in urban mobility and make it available for private operators to build solutions.
Second, arriving at the fair-calculation method, such as fixing the upper and lower limits, might impact both the commuter uptake of these services and incentives for private operators to enter and stay in the market. The terms of collaboration between the two can support or weaken the future of MAAS in India.
Governing the attention-poor requires attention. Paying close attention to MAAS in India could be the way forward.
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Petrol in India is cheaper than in countries like Hong Kong, Germany and the UK but costlier than in China, Brazil, Japan, the US, Russia, Pakistan and Sri Lanka, a Bank of Baroda Economics Research report showed.
Rising fuel prices in India have led to considerable debate on which government, state or central, should be lowering their taxes to keep prices under control.
The rise in fuel prices is mainly due to the global price of crude oil (raw material for making petrol and diesel) going up. Further, a stronger dollar has added to the cost of crude oil.
Amongst comparable countries (per capita wise), prices in India are higher than those in Vietnam, Kenya, Ukraine, Bangladesh, Nepal, Pakistan, Sri Lanka, and Venezuela. Countries that are major oil producers have much lower prices.
In the report, the Philippines has a comparable petrol price but has a per capita income higher than India by over 50 per cent.
Countries which have a lower per capita income like Kenya, Bangladesh, Nepal, Pakistan, and Venezuela have much lower prices of petrol and hence are impacted less than India.
“Therefore there is still a strong case for the government to consider lowering the taxes on fuel to protect the interest of the people,” the report argued.
India is the world’s third-biggest oil consuming and importing nation. It imports 85 per cent of its oil needs and so prices retail fuel at import parity rates.
With the global surge in energy prices, the cost of producing petrol, diesel and other petroleum products also went up for oil companies in India.
They raised petrol and diesel prices by Rs 10 a litre in just over a fortnight beginning March 22 but hit a pause button soon after as the move faced criticism and the opposition parties asked the government to cut taxes instead.
India imports most of its oil from a group of countries called the ‘OPEC +’ (i.e, Iran, Iraq, Saudi Arabia, Venezuela, Kuwait, United Arab Emirates, Russia, etc), which produces 40% of the world’s crude oil.
As they have the power to dictate fuel supply and prices, their decision of limiting the global supply reduces supply in India, thus raising prices
The government charges about 167% tax (excise) on petrol and 129% on diesel as compared to US (20%), UK (62%), Italy and Germany (65%).
The abominable excise duty is 2/3rd of the cost, and the base price, dealer commission and freight form the rest.
Here is an approximate break-up (in Rs):
a)Base Price | 39 |
b)Freight | 0.34 |
c) Price Charged to Dealers = (a+b) | 39.34 |
d) Excise Duty | 40.17 |
e) Dealer Commission | 4.68 |
f) VAT | 25.35 |
g) Retail Selling Price | 109.54 |
Looked closely, much of the cost of petrol and diesel is due to higher tax rate by govt, specifically excise duty.
So the question is why government is not reducing the prices ?
India, being a developing country, it does require gigantic amount of funding for its infrastructure projects as well as welfare schemes.
However, we as a society is yet to be tax-compliant. Many people evade the direct tax and that’s the reason why govt’s hands are tied. Govt. needs the money to fund various programs and at the same time it is not generating enough revenue from direct taxes.
That’s the reason why, govt is bumping up its revenue through higher indirect taxes such as GST or excise duty as in the case of petrol and diesel.
Direct taxes are progressive as it taxes according to an individuals’ income however indirect tax such as excise duty or GST are regressive in the sense that the poorest of the poor and richest of the rich have to pay the same amount.
Does not matter, if you are an auto-driver or owner of a Mercedes, end of the day both pay the same price for petrol/diesel-that’s why it is regressive in nature.
But unlike direct tax where tax evasion is rampant, indirect tax can not be evaded due to their very nature and as long as huge no of Indians keep evading direct taxes, indirect tax such as excise duty will be difficult for the govt to reduce, because it may reduce the revenue and hamper may programs of the govt.