The report Realising the potential - available as a PDF below - is published by Central London Partnership, Living Streets, London Cycling Campaign, Sustrans and Transport 2000.
It shows that half of all journeys in the capital are less than 2 kilometres. Walking and cycling could therefore replace 1.4 million trips made everyday in London by car, Tube and bus. This would cut total car trips by 8.5 percent and Tube and bus trips by 7 percent.
Walking and cycling conditions would need to be made much more attractive but world class facilities could be provided within six years at a total cost of £330m, says the report.
Comparing this to other infrastructure projects, the transport groups say the £330m would be "excellent value for money."
The Cross River Tram would cost £400m and carry 110,000 to 137,000 passengers per day. The West London Tram, at £425m, would carry 95,000 -136,000 passengers per day. The Thames Gateway Bridge would cost at least £450m and carry 70,000 vehicles per day. Crossrail, at a current estimate of £10 billion, would cater for 500,000 passengers per day.
"Walking and cycling facilities could be completed much more quickly than any large public transport scheme and would bring a wide range of health, environmental, urban regeneration and economic benefits," says the report.
The reports estimate of the number of journeys that could be transferred to walking and cycling is based on the fact that most journeys in London are very short. More than half are less than 2 kilometres. One car journey in six is less than 1 kilometre and could easily be walked while half of all car journeys and nearly a quarter of Tube journeys are less than 3.7 kilometres (the length of the average cycle journey). Three quarters of all bus journeys are an easy cycling length. At the moment only 2 per cent of journeys are made by bike in London compared with more than 20 per cent in some other cities in Europe and the UK.
Richard Bourn, London Campaigner at Transport 2000, said:
Transport for London says it will only fund walking and cycling if it receives a larger Government grant. But modern walking and cycling facilities would be such good value and so effective in tackling congestion on the roads, Tube and buses that they should be funded anyway. This would help avert the looming financial crisis in Londons transport system.
Patricia Brown, CEO of the Central London Partnership, said:
We obviously need more and better public transport. Our experience working with businesses has also shown how important it is for the success of the London economy that much more attention be paid to meeting the needs of pedestrians and cyclists.
Tom Bogdanowicz, campaign officer at the London Cycling Campaign, said:
We are facing an obesity epidemic. The medical profession is united in calling for people to take more exercise. Walking and cycling are ideal forms of exercise which can easily and enjoyably be fitted into peoples daily lives.