Uber CEO targets affordable rides in challenging Indian market

Uber Technologies Inc. is looking to accelerate its growth in the affordable and potentially more lucrative market for two- and three-wheeled rides in India, intensifying its ongoing competition with local provider Ola.

CEO Dara Khosrowshahi spoke Thursday of how Uber was trialling services from scooters to motorcycles in his “toughest markets,” providing a model for expansion in other countries. The CEO also introduced the idea of bus services in a panel discussion in Bangalore with Nandan Nilekani, the billionaire founder and chairman of IT services company Infosys Ltd.

Khosrowshahi is a rare visitor to the Asian country, which represents one of his biggest markets, especially since he withdrew from China and Southeast Asia. Uber just posted its first annual profit, a milestone for a company that has at times struggled to make headway in the region’s fast-growing market. In India, both Uber and Ola have struggled to achieve consistent profits in a fast-growing but price-sensitive market.

The CEO was there to announce a potentially significant contract with the help of an initiative supported by the board.

Uber entered into a memorandum of understanding to explore joining the Open Network for Digital Commerce, one of several government-backed programs set up by the Modi administration to try to standardize online transactions and finance. The potential membership of the US ride-hailing leader could strengthen India’s efforts to build a complete digital infrastructure to support the rapid growth of the online economy.

Other key areas in the wider operation are the national digital identity program called Aadhaar and the Unified Payments Interface, through which banks and Internet companies handle transactions. Built with open protocols from the beginning, the idea is to enable startup companies, domestic companies and global large companies to operate equally.