App-based ride-hailing: Experts welcome Punjab’s decision to update Motor Vehicles Ord

ISLAMABAD: Punjab’s decision to update transport law and explicitly bring app-based ride-hailing into the regulatory framework is a welcome correction to update Motor Vehicles Ordinance across the province.

Experts told Business Recorder that the Motor Vehicles Ordinance of 1965 could not possibly have foreseen smartphones, algorithmic dispatch or platform-based labour. Recognising these services is a necessary first step towards passenger safety, accountability and tax compliance. However, intent does not equal impact. As currently drafted, Section 44B shifts a disproportionate share of cost and complexity onto the province’s drivers, who are the very people the reform should protect.

Official labour statistics show persistent unemployment and constrained formal job creation. Flexible, entry-level platform work provides predictable daily income and the autonomy to juggle family responsibilities. At the same time, drivers are living with persistent inflation. The fast-rising urban utility bills, and fuel-price volatility makes every kilometre a careful calculation. Adding recurring, district-by-district permit fees is not a neutral policy tweak. It is an economic shock to already thin margins.

They said that section 44B’s core flaw is its territorial and platform fragmentation. By requiring route permits that are both district-specific and platform-specific, the law treats modern urban mobility as if each trip began and ended inside neat administrative boxes. Across metropolitan regions a single trip can cross multiple district boundaries, where drivers routinely log fares on more than one app to sustain earnings.

Under the proposed framework, the moment a car crosses an invisible line it risks operating “without a permit.” Multiply that risk by 30-plus districts and several apps, and the result is a compliance regime that is expensive, administratively burdensome and practically unenforceable.

Talking about practical barriers, they stated that applying for permits across several Regional Transport Authority offices, assembling documentation, paying multiple annual renewal fees are tasks that require time, money and institutional know-how. Those are resources many gig drivers do not have. The inevitable outcome will be unequal compliance that larger fleets or drivers affiliated with better-resourced networks will manage, while marginal drivers will either be pushed out of the market or forced to work informally, which defeats the law’s objective of bringing the sector into the formal fold.

There are clear alternatives that meet the government’s stated goals without imposing needless costs on drivers. A province-wide single permit model would provide regulatory oversight, traceability and accountability while matching the operational reality of app-based mobility. Enforcement becomes simpler, drivers face fewer bureaucratic hurdles, and platforms retain a clear point of compliance. This approach protects passengers and generates the documentation regulators want, without turning drivers into unpaid compliance officers.

If the province embraces a practical, driver-centred approach now, other provinces will likely follow, they added.

Copyright Business Recorder, 2026