Russian monopoly on taxis and riders in Central Asia

The company Yandex has increased the percentages for taxi drivers, and has stifled all the other players in the market for the transport of people and goods (including Uber) in Kyrgyzstan, Kazakhstan and Uzbekistan. The measures launched by the local antitrust agencies have been ineffective.

Astana (AsiaNews) - The Russian company Yandex, which started out as an internet service provider and has become a giant in e-commerce, taxis and deliveries, has now monopolised the sector in most of Central Asia.

It has no real competitors in Kyrgyzstan, Kazakhstan and Uzbekistan, although it has not yet managed to conquer the Tajikistan market, where the rights of Russian investors are limited, as they are trying to do in other countries in certain sectors.

The transport service was launched in 2017 in Bishkek, the capital of Kyrgyzstan, where the locals couldn't believe they could be transported in large luxury cars at the same price as the old run-down cars of traditional taxi drivers, and this made the popularity of the Yandex.Taxi system skyrocket, which is dependent on Russia's most important internet platform.

Today the service has expanded to include the delivery of parcels and food, and has also sparked social and political discussions at the highest levels. During the session of the Eurasian Intergovernmental Council in Almaty, Russian Prime Minister Mikhail Mishustin complained to his Central Asian colleagues about the pressure being put on this important Russian company.

The Moscow Foreign Ministry also sent a note of protest to Bishkek, to defend Russian investors in Kyrgyzstan. Even if Yandex wasn't directly mentioned, it was clear that the services offered by this group were the subject of the dispute, as emphasised by a member of parliament from the Zhogorku Kenesh, Zanarbek Akaev, who denounced the ‘monopolistic policies’ of Yandex that increase the percentages for taxi drivers, suffocating all the other players in the transport market for people and goods.

According to many, this is a business controlled by ‘people who have occupied prominent positions in the Kremlin’, obtaining favours to boost these initiatives. The Kyrgyz security committee GKNB has therefore carried out checks and searches at the local Yandex office and those of its partners.

In Kazakhstan, Yandex has been present since 2009 as an internet search engine, and since 2016 it has entered the transport market, especially in the main cities, where it has also become the dominant company at the beginning of 2020, defeating and ‘swallowing up’ all its rivals, starting with Uber, which had entered Kazakhstan in 2014.

Now Uber works for Yandex in Russia, Kazakhstan, Azerbaijan, Armenia, Belarus and Georgia. Only in the smallest Kazakh cities can you still see the cars of independent local taxi drivers, who are barely surviving, and often complain about the monopoly on social networks.

In December 2023, the Kazakh Agency for the Defence and Development of Competition sued Yandex for imposing its services on all the country's car fleets and technical assistance centres, forcing it to pay 3 billion tenge to the national fund supporting Kazakhstan's digital ecosystem.

Yandex has been active in Tashkent since 2018, and is present in all the most important cities, also provoking protests and investigations by the Uzbek tax authorities.

Over 13 thousand Uzbekistan taxi drivers work for the company, paying a 20% commission on fares and having to purchase a licence at their own expense, for 30 dollars a year.

Tajikistan, on the other hand, imposed barriers to Yandex's entry, defending the traditional local services of yellow and black taxis, when the company tried to enter the market in February 2023 by offering transport services in Tajik, Russian and other languages with trips starting at a cost of 10 somoni, about 1 dollar, choosing between the Ekonom, Komfort and Komfort+ categories.

The state agency Dušanbe Nakhlyotkhadamotrason, which is responsible for the transport system in the Tajik capital, reacted immediately by declaring that ‘Yandex does not have permission to operate in the city's taxi market’.

The city council confirmed the ban, and the traffic police began to stop the drivers already employed by Yandex, until the Ministry of Transport officially decided on the ban. The transport market in Tajikistan remained rather confused and inefficient, but the Russians were not allowed to take it over.