State of Indian Trucking Industry: From Bad to Worse?

Indian Trucking Industry, in the present circumstance, is facing one of the worst crises in the last few decades. According to All India Motor Transport Congress, an umbrella body of goods vehicle operators representing about 10 million truckers, the daily movement of trucks has collapsed to less than 10% of normal levels amid the outbreak of the deadly coronavirus. The sector being one of the most crucial elements of the supply chain has borne the brunt like none others due to its volatility. Logistics Insider, in this feature, explores the challenges faced by the industry caused due to the halt, the extended support provided by the government and the industry outlook in the post-COVID world.

The Road Transport Sector of India which is highly unorganised and marginalised is one of the critical sectors for the economy. It is operational 24×7 for 365 days of the year and is one of the highest employment generators as 85% of the Transport Community constitutes small operators -having one to five trucks. More than 20 crore people are dependent on the sector. But the world’s biggest lockdown has brought the transportation industry to a halt.

Trucking Industry in India has emerged as a major choke-point in the supply chains for everything from food to medical supplies as governments take stringent steps to contain the pandemic, restricting the movement of vehicles and people to drive them, causing a shortage of drivers, staff, loading and unloading labours.

Chirag R Katira, Project Head For ‘Fight Against COVID 19’ at All India Motor Transport Congress (AIMTC) and Director of Shree Nasik Goods Transport Co. Pvt Ltd talked about the challenge faced due to the unavailability of help from local administrations. He says, “There is also a challenge that local administration is neither forthcoming to help them nor there is any public transport system in place and local administration is not capable to ferry labourers and drivers scattered at far off places to their vehicles and stations.”

According to Sandeep Chatterjee, Associate Director, Deloitte, “Though Indian trucking industry was earmarked as an essential service, the ground reality was different. The trucking industry was expected to carry essential goods but this did not happen as there was a long queue for police permission. Secondly, there was not much lead time for the truck operators to act when the lockdown was announced. Thirdly, the communication was to stay home and hence many of the truck drivers either went home or ere stranded.”

Also, most of the godowns, factories and warehouses are restricted from operations while the ones operating have less staff, due to which goods could not be unloaded from the trucks, thus collapsing the operations of the trucks from the usual.

Despite the government’s easing of curbs from April 20, the trucking industry in India is not likely to see an immediate normalcy. Mr Katira says, “Partial opening of the sectors cannot not help in demand creation and / or consumption of goods at the normal level. Weak economic activity will lead to weak demand in the road transport sector and hence high rate of idling of vehicles and collateral pressure on the operators.”

This is an unorganised sector based on daily wages. Thus, during the sudden hit of the pandemic, there was no security net. The drivers who have gone to their home need to be motivated and given health and financial security in order to run the industry efficiently.

[Also Read: Debunking Post-COVID Demand Surge in the Trucking Sector]

Government’s Support: Too Little, Too Late

The road transport sector is a vital sector for the economy as 60% of the transportation in the nation takes place via road. Amid the sudden lockdown, the people engaged in the sector have felt the adverse implications. The transporters have been plying their vehicles to carry essential loads with no load or freight on one side of the journey on a ‘no profit, no loss’ basis.

Mr Chatterjee says, “Once again it has been demonstrated how important the logistics function is. The industry has lobbied hard to get the necessary permission for trucks to ply. Government has eased out a few norms to make sure that the trucks carry the essential commodities. Steps are on to track these so that the fleet owners have a full view of where the trucks are.”

Though the transportation of goods by road has been included as one of the essential services exempt from restrictions, the government’s frequent clarifications have led to confusions.

Mr Katira feels that there is no tangible support coming underway while the situation is aggravating with every passing day.

He further adds, “The Government too tweaked its policies every now and then and the changes/updates do not reach the authorities at the personnel enforcing them at the crossroads. The picture remains the same till date.”

This is an abridged version of the exclusive story published in the May Issue of the Logistics Insider magazine. To read the complete and unedited version of the story and other exclusive content, please download your e-copy now.

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