With losses spiking up amid fresh restrictions and lockdowns in the country, the Transport Sector has witnessed losses amounting to INR 1000 crore per day, rising further with the intensity and duration of the Corona-induced lockdowns and curbs.
The government needs to take proactive steps on EMI Moratorium, Tax & Insurance Waiver, E-way Bill Validity Extension, to avoid imminent financial crisis, shares Bal Malkit Singh, Chairman – Core Committee & Former President, All India Motor Transport Congress (AIMTC).
On April 12, when restrictions were imposed in the state of Maharashtra, AIMTC Research Unit (ARU) assessed daily losses of about INR 315 cr per day. As per the fresh assessment made by the ARU, the daily losses to the transport industry have mounted to about INR 1000 crores per day.
Since then, the lockdown and night curfew has been extended to other states where COVID cases have surged abnormally that has disrupted businesses financial delinquencies have hit microloans, MSMEs and CV finance segments. This is going to further deepen the crises.
The state of Delhi, Punjab, Rajasthan, Uttar Pradesh, Madhya Pradesh, Karnataka and others have also imposed strict restrictions on the movement of non essential goods. Demand for vehicles has come down by about 50% leading to increase in idle capacity.
“If the situation worsens, attracting fresh lockdowns and restrictions, then this loss will further augment leading to financial crises in the industry and excessive loss of livelihood. ARU predicted deterioration of financial situation among various sectors including transportation sector where payments are not forthcoming as due to low consumption and demand manufacturers too are not realizing their proceeds. This is going to augment bad loans and NPAs and default of statutory compliance like Taxes, Insurance, Fees and other statutory compliances like TCS, GSTR returns, TDS etc.,” shares Mr Singh.
We have no resources at the back-end as all payments are stuck. We could foresee worsening of the situation in the very near future and more than 20 crore people associated with the Transport Sector are forced under greater pressure and multi-fold challenges leading to untold mental anxiety and financial distress.”~ Bal Malkit Singh, Chairman – Core Committee & Former President, All India Motor Transport Congress (AIMTC)
The intensity and duration of lockdowns and curbs will further hit the Transport Sector badly. Therefore, immediate, prudent and proactive steps must be taken by the government to avoid another crisis in the offing, before it is too late, warns the Chairman.