Ola gets wise, promises $15m where it matters

Ola’s Bhavish at a launch event . Photo credit: Tech in Asia.

Just days after being taken to task for suggesting the Indian government should help Indian startups over their global rivals, and a month after it spent bags of money on a gimmicky project, Ola has finally seen the light.

On Monday, the company said it has signed a memorandum of understanding with National Skill Development Corporation (NSDC) of India to help 100,000 drivers with training, skill development, and empowerment in the next three years.

Note that it’s simply a “memorandum of understanding,” which is by definition a non-binding agreement and not a solid deal. Still, Ola says it will invest US$15 million in this project, which involves “identifying people from various sections of the society and skilling (sic) them to become driver entrepreneurs.”

The initiative is part of Ola’s bigger aim of adding 5 million drivers to its community over the next five years.

Skill training for drivers is a key aspect of winning India’s transportation market. While Uber and Ola are battling over market share, users have long complained about cab availability, driver behavior, and service. In India, some problems stem from root problems like partial literacy. Drivers are often unable to read Google Maps or the addresses fed into the GPS, and thus get lost or end up taking longer routes.

Many are still unsure about handling their apps, often asking their passengers to help them.

Ola’s announcement suggests the company is taking note of its basic problems. It also doesn’t hurt to woo the government a little. The announcement was made in the presence of the Prime Minister of India, Narendra Modi.

Ola’s announcement comes a day after Uber jazzed its own initiative UberSHAAN, which focuses on former servicemen of the country. The actual initiative was launched in partnership with Maruti and the NSDC in September this year with the purpose of creating livelihood opportunities for one million people by 2018.

Uber and Ola have both seen various hurdles with the government over regulations, sometimes even leading to a ban of their services.

Converted from Indian rupees. US$1 = INR 67.82