With most trucks off the road, the transportation sector is facing a substantial reduction in its business. Naveen Kumar Gupta, Secretary General, All India Motor Transport Congress (AIMTC), spoke to BE’s Kuntala Sarkar regarding the ongoing crisis.
Q. The central government is planning to resume transportation soon. How are you looking at this?
A. The problems of our sector are continuously increasing. At this juncture, transporters are not having any business because the entire economy is in lockdown. The sector is lacking finance for salaries, to meet establishment costs, EMIs, insurance, permit fees, taxes and term loan liability stands. In spite of the moratorium, finance companies are still pressurising small operators to pay back. Around 85% of the players in road transport are small operators. They are in abject penury, unable to sustain their financial obligations and are being pushed out of business. Under this situation, just allowing our vehicles back on the road is not enough. The overall demand has fallen drastically. Additionally, the operating cost has increased with a significant rise in the price of diesel. There is no demand and the government has also resumed toll taxes.
Q. As a large number of trucks are off the road, what can be the volume of losses?
A. About 70%-75% trucks are presently not on the road and the rest is operating in the essential commodities space. Approximately, `2200 crore is the daily loss to the transport sector alone. Factories, warehouses, godowns, and booking offices are all closed. There is a genuine fear of bankruptcy among various transport operators.
Q. How challenging is it in the ground level to get vehicles on the road for transporting essential commodities?
A. We have been consistently apprising the government regarding ground realities and about the acute adversities faced by our sector in this period. Reports of harassment and cases of stopping of vehicles are continuing as authorities insist on local permission in spite of clear directives and necessary clarifications issued by the Ministry of Home Affairs of the Indian government. Extortion and corruption have reemerged in various check posts. The poor drivers are the first targets but there are other means of extortion as well. It is often being done in the garb of compounding fees ranging from `1500 to `2500.
Our request for sanitisation of vehicles every 200 kilometres at toll plazas and at petrol pumps and regarding screening of drivers has not been implemented so far. We have reports from Gwalior, Nawashrar, Sidkul, and Vijayawada about drivers being inflicted with Covid-19. They are highly exposed as they interact with a number of people (especially at toll plazas) while being on duty.
Q. How difficult is long distance transportation under these circumstances?
A. It is very difficult for us to undertake inter-state or inter-district transportation under the current circumstances. There is uncertainty of availability of food and water for the transporters and the safety of goods is also being compromised. Additionally, harassment, extortion and corruption at state check post borders are multiplying our woes.
Q. How is the turmoil in international crude oil prices impacting the Indian transportation sector?
A. The central government has increased the excise duty and not passed on the benefit of falling crude oil prices to the Indian citizens. That move will not only lead to disruption of transport services but also cause inflation. Worldwide, governments are liberally opening their coffers to extend a helping hand to their citizens and to various sectors that are impacted by the lockdown. Increase of VAT by state governments is also hard for our sector and will negatively impact small operators.
Q. What would be your policy suggestions to ease the functioning of the sector?
A. The delay by the government to announce a rescue package for helping the distressed road transport sector is perplexing. Additionally, we are still awaiting the announcement of Covid-19 insurance for drivers and co-workers engaged in essentials services in the cargo and passenger spaces. We demand relaxation on establishment cost (electricity bill, water bill, rent, property tax, interest on loan etc.), salaries and maintenance expenses. We expect the next two quarters to be turbulent and governmental support is essential for the sector. We also want more availability of soft loans. Deferment of all statutory compliances, taxes/fees (central and state), EMIs for the FY 2020-21 and waiver of interest on EMIs for the deferred period is necessary. We are also demanding a refund of TDS with no cap on the refund amount to meet the administrative expenses in our sector.