Kathmandu Metropolitan City (KMC) has decided to ban roadside parking in much of the New Road area and has provided an alternative of free parking at Kathmandu with sufficient space for 300 four-wheelers and 700 two-wheelers and Tower and a 50,000 sq foot space at a building near Dharahara. This has led to protests from local business operators. To lay a baseline: traffic congestion in Kathmandu is a problem, inconvenient parking distances can and will affect footfall thus affecting business, and public protest against a government decision does not automatically make it a bad decision. That being said, there are issues with KMC’s decision-making on its parking policies.

Economists everywhere play around with the “incentives” presented by every decision to determine whether it is effective in achieving the public goal and figure out the best way to do so. One issue with KMC’s solution is the fact that alternative parking has been offered for free. At first glance, as consumers, we may be inclined to see this as a win, but in an economy, everything has a cost – as the expression goes, “there is no such thing as a free lunch.” In his 2005 book ‘The High Cost of Free Parking,’ economist Donald Shoup from the University of California, Los Angeles (UCLA) advocated the following scheme: charging for street parking anywhere where there are more people with cars than spaces to park. Parking space everywhere is a finite resource. Kathmandu Tower and the building at Dharahara offer space for around three thousand vehicles in a city with over a million and has made that service free of cost to the consumer. Without a perfectly digitalized system and an app to monitor and communicate the exact space available to the public, traffic congestion will re-emerge in the area from parking space competition with the first-come-first-serve incentive. Free parking subsidizes driving, however, if the number of free parking spaces is fewer than the number of people wanting to park, the consumer surplus is reduced by the uncertainty of finding a parking space.

Since the supply is now very limited compared to the demand, a set price would be the same as having it gratis – unless the price is very high. As such, a system of online booking would be more effective in allocating the space without causing much congestion near the building.

In general, managing traffic congestion does not require a ban on street parking. Rather, it requires more effort. Banning it and then offering limited spaces for free – then looking the other way thinking it is a job well done is easy, but not effective. The additional space that on-street parking offers should be utilized; it just needs to be managed well. Up until early 2011, San Francisco suffered a major traffic issue of cruising – people driving around in their vehicles merely to find a vacant spot to park. The root cause of traffic congestion is not roadside parking, vehicles stalling, or accidents; it is cars. The more cars are driving on a road at any given time, the more congested the road will be. Cruising meant more cars slowly driving around, thus leading to congestion. The way San Francisco solved this was not by banning roadside parking altogether. Instead, the city focused on creating a system of “smart parking” where available parking spots were displayed via smart applications that guided drivers to the exact location of the desired spot. The system called ‘SF Park’ priced roadside parking competitively based on demand and supply. Since it did not limit parking space, it not only dealt with the city’s motorists’ worst nightmare and streamlined the traffic flow but also increased local sales tax revenue since people spent less time cruising around and more on businesses.

In 2019, the mobile app ‘Park KTM’ was launched through which people could book parking spaces – especially in the New Road area. The parking spaces were monitored with cameras, and a server linked with the app provided the status of the parking lots. Vehicle owners would need to arrive at the booked space within 15 minutes. If they failed to do so, the app would cancel the booking. The app does not run anymore and was discontinued. If this system could be applied to street parking, KMC could emulate the success of San Francisco in reducing traffic congestion without burdening business operators or motorists.

KMC wants to turn major commercial areas into pedestrian-only zones. This is a justified desire, but when dealing with travel behavior in the masses, it needs to account for much more than just the time lost to customers in the area. Urbanists talk a lot about the 5-minute walk rule. Theoretically, the average adult will walk rather than drive to their destination if it’s less than 5 minutes away. The phrase ‘Pedestrian Propulsion’ refers to how much longer people would be willing to walk to their destinations. Many opine that “the mustache does not stop a morsel” in that if somebody really needs to buy something from New Road, they will regardless of the parking policies. This is a terrible way to look at it. Every little aspect contributes to a person’s decision-making, and convenience is a huge factor. Travel behavior affects spending behavior which affects the local economy. Perhaps a better way to approach this would be to not ban street parking, but rather offer it at a cost. Perhaps the cost per hour for parking roadside at busy commercial areas should be higher than at nearby parking complexes. The total amount of parking spaces would increase, and in this case, someone who can afford and needs to park roadside to save time will do so – leaving the nearby parking complexes with more space for people who can afford the time and price to park there. This system needs more effort to construct and uphold, but it at least offers more of an already finite resource.

While KMC’s goals are justified, its course of action may be misguided. Change does not happen overnight. When trying to direct people away from buying or using vehicles, the government needs to first erect a strong and reliable public transport network. Banning on-street parking without ensuring sufficient paid parking and proper public transport will only stick the citizens between a rock and a hard place. The effect on local businesses with reduced sales revenue and the deadweight loss of free parking will help nobody – including the metropolitan. This makes it clear – while the problem of traffic congestion and vehicle emissions in the valley are prominent, the solutions need more nuance, thought, and discourse. KMC’s current modus operandi of enforcing new regulations that affect people en-masse overnight without consulting with the stakeholders has led to fear and protests from the public.

KMC has to communicate with the people in the area if it wants to successfully implement its plans. What is unclear is that it enforces decisions with a lot of uncertainty to the public. Perhaps the metropolitan will create bicycle lanes and incentivize bicycle renting businesses in the area – allowing customers to move around quicker and more sustainably in the area. However, we do not know this yet because the metropolitan is insistent on taking action without trying to ease the public’s worries and concerns with some proper dialogue.

The business operators protesting this decision have a fair fear. As customers find it easy to park their vehicles, they are more likely to visit and explore a business establishment. Increased foot traffic leads to higher exposure and more opportunities for sales. A shopkeeper who operated a luggage store stated, “On the day after the parking ban, around 4:30 pm, my shop had our first sale of the day. Before the parking ban, we would have seen around 50k to 100k in sales revenue during that point in a day.” Without a strong public transport system or a smart street parking system, this decision by KMC will put people in a difficult position over time. While the city may be trying to de-incentivize driving, it requires more nuanced policies and better dialogue with the locals. While the decision has enraged business operators in the short run, it may enrage both them and the consumers in the near future.