Indian ride-hailing app Ola is poised to take on rival Uber in a foreign market for the first time, gearing up to launch operations in Australia early this year.

The move comes amid signs of slowing growth in India's ride-hailing market, where Uber has been gradually closing the market share gap with its local competitor.

Ola said on Tuesday that it was inviting inquiries from owners of private-hire vehicles in Sydney, Perth and Melbourne ahead of a launch in Australia subject to regulatory approval.

Its announcement came a month after Estonia-based Taxify launched in Sydney, promising higher commissions for drivers. 

The new competition will add to Uber's headaches in the country, where it faces an investigation into whether its working conditions breach Australian labour laws, and is appealing against tax rules that have pulled down its drivers' earnings.

Tuesday’s announcement was the latest in a flurry of activity at Ola since October, when it raised $1.1bn in capital from investors including Chinese tech group Tencent. In December, it announced the all-share acquisition of food delivery business Foodpanda from Germany’s Delivery Hero — pitting it against UberEats, which launched in India last May.

Ola also has hired a prominent financial technology entrepreneur to run Ola Money, which is a payments platform now mostly used for paying for Ola rides but which the company is seeking to expand through tie-ups with groups such as Pizza Hut and entertainment ticket site BookMyShow.

Founded in 2010, Ola took an early lead in India's ride-hailing market, backed by investment from Japan's SoftBank — which also has invested in Uber — and the US fund Tiger Global Management.

But Uber has made steady gains in market share since its entry in 2013. As of May last year Ola had 5.9m monthly active users, while Uber had 5.5m, according to US research firm App Annie.

The rising competitive pressure comes amid declining growth momentum for the Indian market. Research firm Redseer Consulting found that the Indian ride-hailing market suffered its first ever quarterly decline in bookings in the first quarter of last year, hurt by "flat or dropping consumer demand" and walkouts by drivers in response to falling payment "incentives".

In addition to its efforts to expand in food delivery and financial services, Ola is hoping to edge out its US rival by targeting users beyond India's metropolitan elite. It operates in more than 110 cities versus Uber's 29, and has rolled out low-cost services such as rides in three-wheeled auto-rickshaws.

A spokesperson said Ola was now looking at other international expansion opportunities, but declined to name the markets in question. Indian technology website The Ken, citing anonymous internal sources, reported last year that Ola was planning to launch in Bangladesh, Sri Lanka, Nepal and Bhutan.

The competition between Ola and Uber has resulted in heavy cash burn: Ola reported a net loss of Rs17.6bn ($276m) in the year ending in March 2016, the latest period for which it has filed financial results. SoftBank's acquisition in December of a 15 per cent stake in Uber for $7.7bn has prompted speculation in Indian media that the Japanese group could seek to engineer a merger between the two ride-hailing operations.

Additional reporting by Jamie Smyth in Sydney

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