Coronavirus impact | Road transport sector seeks soft loans
To seek relief from the impact of COVID-19, the All India Motor Transport Congress (AIMTC) has sought soft loans at lower rate of interest, at par with international level, to be worked out for the road transport sector at the earliest so that there is no scarcity of working capital finance for the industry. AIMTC Secretary General Naveen Gupta said the accumulated losses to truckers during the first 15 days of lockdown were about Rs 35,200 crore leading to working capital issues. Currently, working capital finance is raised from NBFCs and private financiers at a higher rate of interest. Gupta says soft loans at lower rate of 2-3%, payable at a deferred timeline would help small operators resume business.
Around 85% of the trucking population consists of small operators consisting of 1-10 trucks. In the wake of the recent crisis, these operators lack the money for upfront payment of diesel, establishment and drivers.
Further, 90 percent of transactions are cash-based, which has led to delay in payments. Track this blog for latest updates on the coronavirus outbreak The MHA guidelines issued on April 15 allowed movement of all trucks and other goods and carrier vehicles.
An empty truck or vehicle will be allowed to ply after the delivery of goods or for pick-up of goods. However, AIMTC said there is no clarity on opening of booking offices, godowns, factories and warehouses and unless that is there the loaded goods cannot be unloaded and goods cannot be booked. As migrant labourers have gone to their native places, labour may not be available for loading and unloading of goods.
guidelines to reach every authority at district level so that there is smooth movement of the goods and vehicles. Several cases have been reported wherein the truck drivers have been stopped at checkposts despite carrrying essential commodities. Less than 10 percent of 70 lakh truck drivers are plying on the roads, several of them having abandoned trucks and left for their hometowns.
The MHA guidelines lack clarity on staff , drivers and labour movement as no public transport system in place, according to AIMTC.
Minister of State for Road Transport and Highways Gen (Retd) VK Singh in an interaction with industry leaders indicated that government is working on an insurance scheme for truck drivers and helpers to give them assurance of their safety and encourage them to return to work.Follow our full coverage of the coronavirus outbreak here