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Slowdown hits goods transport business
Bijith R in New Delhi | January 02, 2009 11:26 IST
A third of the 350,000 trucks plying on long routes face the threat of seizure by their financiers over payment of arrears. Over 7,000 such trucks have already been seized.
Truckers, in short, now face their worst ever crisis. The magnitude is not small. All told, there are 275,000 goods transport agencies or truck operators in the country, who together own 4.43 million trucks. The crisis has put at stake the livelihood of almost 25 million workers who are directly or indirectly employed in the goods transportation industry.
Worst hit are the truckers who worked for miners. With iron ore exports taking a major hit due to lower demand from China, 80-100 per cent of trucks in some of the mining areas of Karnataka, Orissa and Chhattisgarh are out of work, said All-India Confederation of Goods Vehicle Owners Association Vice-president Chitranjan Das.
Das said that a growing number of truck operators are defaulting on the repayment of loans and therefore face the threat of seizure by the financiers. Yes, a large number of trucks have been seized in Karnataka over non-payment of loans in the last few months, said a senior executive at Shriram Transport Finance Company [Get Quote] Ltd, one of the largest commercial vehicle finance companies in the country.
The drop in the availability of cargo for transportation has also resulted in a severe drop in the number of trips undertaken by a truck. For instance, a truck used to operate 18 round trips on the Delhi-Kandla-Delhi route till the last quarter (July-September 2008).
The automobile sector, which constitutes almost 19 per cent of the total manufacturing sector in the country, has witnessed a decline in October 2008. Similarly, other segments like textiles and construction are seeing a major slowdown.
Even those manufacturing companies which still use the services of truckers have extended the credit period. This has put further pressure on the small truck operators as well as the major logistical companies.
Meanwhile, truck operators led by the All-India Motor Transport Congress have threatened to go on a nationwide indefinite strike from January 5, unless their demands are met by the government.
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