A price war between Careem and Uber appears to be heating up, as Dubai-based Careem on Saturday announced a slash in 'Go' booking fares of up to 30 per cent for residents of Karachi days after Uber cut its rates by 30pc for Lahoris.

Careem said Karachiites can now book 'Go' rides at a rate of Rs11 per kilometre as compared to an earlier rate of Rs15/km ─ a discount of nearly 30pc.

Careem's 'Economy' ride service has also received a Rs2 price cut, from Rs17/km to Rs15/km.

Careem entered the Pakistani market last year, launching its services in Karachi, Lahore and later Islamabad.

The cab hailing service, alongside its rival San-Francisco based Uber, gained instant popularity among a Pakistani population that has quickly adopted 3G and 4G technology.

Uber began operating in Lahore earlier this year and recently expanded operations into Karachi in August. The ride-sharing service celebrated its first six months in Lahore with an announcement on Sept 1 that it would slash fares for the provincial capital by 30pc in order to "boost demand".