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Why Nepal's Ride-Sharing Workers Need Legal Clarity

Nepal's ride-sharing drivers may own their motorcycles, but platform algorithms control their earnings, exposing the illusion of entrepreneurship at the heart of the gig economy.
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By Sakshat Pant

Over the past month, I found myself talking to ride-sharing drivers across Kathmandu. None of these were formal interviews. They were brief conversations during rides, in traffic, or while waiting for pickups.



One afternoon, a driver waited nearly 40 minutes for a ride request in the middle of the day. During another trip that stretched to almost an hour in peak traffic, an InDrive driver pointed out that the platform would still take its commission from the fare regardless of how long the journey ultimately took. Several drivers mentioned that passengers sometimes ask them to cancel rides booked through the app and complete the trip privately to avoid platform charges. Others spoke about constantly searching for rides to qualify for incentive bonuses offered by competing platforms such as Yango.


Such conversations offer a glimpse into a form of work that has expanded rapidly across Nepal in recent years. Few developments have been celebrated with as much enthusiasm as the gig economy. Nepal has not been immune to this optimism. According to the Asian Productivity Organization (APO), gig work contributed around 7 percent of Nepal's GDP in 2024, reflecting the sector's growing economic significance. Among its most visible manifestations are ride-sharing platforms such as Pathao, Yango and InDrive, whose motorcycles have become an increasingly familiar sight across the Kathmandu Valley. On the surface, these platforms appear to offer workers entrepreneurial freedom, flexibility, and autonomy.


However, this type of gig work creates a highly ambiguous class position for workers. They own productive assets like small proprietors but remain dependent on selling their labour like employees. They are not entrepreneurs who happen to labour; they are labourers who happen to own their tools. They are neither employees nor conventional small business owners. Traditional categories do not fit them neatly. They own the motorcycle, but they do not control prices, customers, or the platform that connects the two. In that sense, they bear the responsibilities of ownership without enjoying the power that ownership is supposed to provide. I call them "petty proles"—workers who own productive assets while remaining dependent on platform-mediated labour markets.


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Contrary to the popular image of self-directed entrepreneurs pursuing business opportunities, many platform workers appear to be responding to economic necessity. A recent study by Bishwakarma et al. (2024) on Nepal's gig economy found that employed individuals and household heads were significantly more likely to participate in gig work, suggesting that these platforms frequently serve as sources of supplementary income. The study also found that ride-sharing workers were among the least likely gig workers to remain in the sector over the long term, citing inconsistent earnings, high operating costs, long working hours, safety concerns, and legal uncertainties.


The realities of platform work are especially visible in the Kathmandu Valley. Many riders finance their motorcycles through monthly loan repayments while simultaneously absorbing rising fuel and maintenance costs. Hours spent waiting for ride requests or navigating congested roads remain uncompensated, even though such time is essential to the functioning of the service. In a labour market marked by persistent youth underemployment, ride-sharing often appears less an entrepreneurial venture than a necessary source of income.


Although workers formally own their vehicles, the conditions under which this ownership becomes economically viable are governed by platform algorithms that regulate pricing, allocate demand, and discipline behaviour through ratings and account deactivation. Moreover, surplus extraction depends on the platform's control over market access, allowing it to earn a commission from every transaction without bearing the costs of maintenance, fuel, or labour reproduction. Put simply, platforms earn a commission from every ride while drivers shoulder the costs of fuel, maintenance, insurance, and vehicle depreciation. The much-celebrated flexibility of gig work often means that drivers assume the risks while platforms capture a share of the revenue.


Similarly, platform companies consistently describe drivers as "partners" or independent contractors, masking the unequal power relations embedded in algorithmic management. Through rating systems, incentive bonuses, and performance-based visibility, workers are nudged to compete against one another and continually optimise their performance.


Although detailed research on Nepali ride-sharing workers remains limited, studies from comparable platform economies point in the same direction. Research by González et al. (2026) on ride-sharing workers in Indonesia found that the absence of formal labour protections and guaranteed minimum incomes significantly increased stress among platform workers. Although many drivers recognised the insecurity of their situation, this awareness rarely translated into sustained collective action. Their dissatisfaction remained fragmented, often experienced as an individual struggle rather than a shared structural condition.


The same study found that dissatisfaction was generally higher among more educated drivers. Workers with lower levels of education were more likely to view insecurity and hardship as unavoidable realities of survival. This suggests that precarity is reinforced by cultural values that normalise sacrifice, discipline, and hard work as personal virtues rather than outcomes of unequal social arrangements.


These dynamics are not unique to ride-sharing. Across South Asia, platform firms increasingly market speed and convenience as symbols of technological progress while shifting the costs of this acceleration onto workers. In India, the rise of ultra-fast delivery services such as Blinkit and Zepto has popularised the promise of ten-minute deliveries, turning speed itself into a commodity. Yet workers have repeatedly alleged that pressure to meet strict delivery targets encourages unsafe driving, long working hours, and constant algorithmic surveillance. What is celebrated as efficiency for consumers often translates into greater precarity for workers.


The consequences of this model have become the subject of growing public debate. Speaking in India's Rajya Sabha, parliamentarian Raghav Chadha argued that delivery workers routinely face pressure to meet unrealistic deadlines because delays can result in lower ratings, reduced incentives, account restrictions, and other penalties imposed through platform systems. Writing on the dispute, T.K. Rajalakshmi (2026) noted that platform executives publicly dismissed the protest and referred to those disrupting deliveries as "miscreants." The label is revealing. Workers who challenged the conditions under which platform labour was organised were portrayed not as workers advancing collective demands, but as obstacles to the seamless flow of services upon which the platform economy depends.


Nepal's 2083/84 budget proposes compulsory labour registration, written contracts, minimum wage enforcement, insurance coverage, and the inclusion of informal workers in the social security system. It also promises stronger compensation mechanisms for workplace accidents and greater regulation of emerging forms of digital labour. Yet these measures leave unresolved a central question concerning platform workers such as Pathao drivers: Are they employees entitled to labour protections or independent contractors responsible for their own welfare? Unless this ambiguity is addressed, the structural condition of the "petty prole"—ownership without control—will remain intact despite formal policy reforms.


Nepal's gig economy, therefore, cannot be understood solely through the language of flexibility and opportunity that surrounds it. Rather, it represents a reorganisation of labour in which risk, cost, and uncertainty are shifted onto individual workers, while control over prices, access to demand, and work allocation remains firmly embedded within platform systems. Nepal's policymakers have begun to recognise the vulnerabilities of informal workers. Yet regulation will remain incomplete as long as platform workers occupy a legal grey zone between employee and contractor. The concept of the "petty prole" captures this condition: workers own productive assets yet remain unable to exercise meaningful control over the value those assets generate.


The author is with Curiosity Learning.

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