Sanjay Kumar is a worried man. His only means of livelihood has come to an end.

He used to drive one of the 7,000 taxis that have been forced to stop services in Mumbai from December 3, 2008.

"I am running around for a loan. My old car will get me Rs 12,000 if I sell it to a scrap dealer. I will have to pay Rs 32,000 as down payment. The new car will cost about Rs 2 lakh (Rs 200,000). I hope a loan is sanctioned soon. Now, I do a part-time job as a mechanic and make some money. The taxi was everything to me," he laments.

Most of the taxis are on the last leg of their journey. The Maharashtra government had set the deadline of December 3 for phasing out taxis that were more than 25 years old.

Currently, there are about 51,000 taxis plying in Mumbai. Of these, over 7,000 have been phased out. Another 1,500 cars will have to wind up services in the near future as they near the ripe old age of 25 years for a cab.

This move has hit the taxi drivers whose only source of livelihood has been threatened. "We are not against the government order for a complete phase-out. But the union was not consulted in this matter, the government took a unilateral decision," says A L Quadros, general secretary, Mumbai Taximen's Union.

There has been a lot of debate over rise in pollution and environmental threats caused by these vehicles, but taxi drivers refute this, saying that all taxis run on CNG or LNG. They reckon that the Fiat taxis (of yore) are sturdier and safer compared to the Maruti [Get Quote] Omni (which is the model most cabbies plan to buy to get back on the roads). The government move is to encourage fleet taxis, they point out.

"This has nothing to do with concerns about pollution and safety. This is a part of the government's plan to change Mumbai to Shanghai," retorts Quadros.

Environmentalists favour phase-out

Meanwhile, environmentalists who support the phase-out programme say that the taxis are dirty, old, unsafe and polluting and should be replaced by less-polluting and safer vehicles. "Many of the cars look as if they will fall apart. They should be replaced with modern vehicles, which are built to protect passengers," says Debi Goenka of Bombay Environmental Action Group.

People are supporting this move to introduce new cars. "The old cars must be scrapped. They are dirty, ill-maintained and dangerous for travellers," says a media professional who commutes by taxi daily. Another regular taxi commuter, says, "I managed to escape by the skin of my teeth when my taxi caught fire on the highway. It was very scary."

Most cabbies in trouble. . .

Out of the 7,000 taxies phased out, 100 drivers have bought new cars. Earlier, many taxi drivers joined the MERU radio car service (a private taxi service).

"Taxi drivers are facing financial problems. It is not easy to get a loan these days, says Raju, a taxi owner. "Now, taxi drivers have no choice but to apply for a loan and buy a car. But the interest rates are very high and banks are not keen to offer loans to taxi drivers," says Quadros.

All the taxi drivers are not owners of the cars. These drivers merely hire taxis from the owners at big daily rents. These cabs are owned by people who can afford to buy new cars, points out Goenka.

Besides this, the Mumbai Grahak Panchayat had done a study on the taxi fares and submitted to the Road Transport Authority, he says. Based on the CNG, LNG fuel, they should be charging only Rs 6.50 as the minimum fare. But taxis continue to charge Rs 13. The study reveals that every taxi makes about Rs 195,000 annually. So buying a new car for about Rs 200,000 should not be a huge burden, counters Goenka.

Currently, taxi-men have received loans from the New India Coo-operative Bank and Kurla Nagrik Bank at 11.5 per cent and 13 per cent interest rates, respectively. Quadros says that Bank of India, State Bank of India [Get Quote] and Rajasthan Bank have not shown interest in offering loans to taxi-men.

However, car manufacturer Maruti has offered a discount of Rs 50,000 on its Maruti Omni and WagonR models to taxi drivers. The cars are available at Rs 1.89 lakh (Rs 189,000) and Rs 2.35 lakh (Rs 235,000) for taxis.

Meanwhile, the Mumbai Taximen's Union is seeking an interest rebate, repayment time of 10 years, and exemption of sales tax, octroi and professional tax for new cars. The union also wants nationalised banks to offer them quick and easy loans.

"We will hold a meeting with the government officials next week. We want the government to extend the deadline (of phasing out old taxies) by a year. The court hearing is on January 8, 2009, when a final decision will be taken," says Quadros.

It was Premier Automobiles which joined hands with Fiat in introducing taxis in India. Premier started manufacturing cars in India in 1968. The beleaguered company, however, stopped manufacturing in 2000. Premier cars became very popular in India as people preferred the sleek model to the bulkier Ambassador from Hindustan Motors [Get Quote]. At the time, those were the only two cars available in India, unless you could afford importing American or European cars.

Whether the government extends the deadline or not, the fate of the Mumbai's Fiat taxis is sealed. Sooner or later, they will be swept off the roads.