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.