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On Monday, the Supreme Court sought the Centre's response to a plea demanding that an additional green cess be imposed on all privately-owned diesel and petrol cars in the National Capital Region, while also seeking its view on a suggestion that a 25 per cent charge be imposed on new diesel cars sold in the capital. As the bench observed, with most soft options exhausted and Delhi's air quality reverting to the bad old days before buses, taxis and auto rickshaws were made to switch to CNG, perhaps the only way to reduce pollution and decrease congestion is to make it more expensive for people to own and operate cars.
It is evident that Indian cities in general and Delhi in particular cannot indiscriminately continue to add vehicles at current rates. According to the Delhi Statistical Handbook, more than 5 lakh vehicles, of which about 1.7 lakh were cars, were added to Delhi roads last year, with no appreciable corresponding increase in road space. Not surprisingly, Delhi's green cover over the same period has decreased, and there has been a rise in deaths due to respiratory diseases. And it's not just Delhi — Bangalore and Hyderabad, too, have seen high vehicular growth. It is unsurprising, then, that a Pigovian tax is required to keep air pollution and congestion under control.
Such taxes have had some success in reducing congestion and beefing up public transport systems in cities like London and Singapore, with the monies collected from the tax going back into each city's public transport system. In London, for instance, the congestion charge came into force in 2003, and different rates apply to different categories of vehicles, with greener cars being exempt from the charge. Studies on its impact suggest that the number of vehicles entering the city has reduced considerably, while the numbers of buses, taxis and bicycles have risen. Indeed, according to some estimates, bus usage has gone up by 60 per cent since the charge was introduced, indicating that the right policies can encourage people to move to public transport. The green cess in Delhi can replicate some of these successes, but the government must not stop there. Parking, too, should be made more expensive, and the money collected funnelled back into the public transport system.
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