Transport Sector Took A Hit Of 28% In August 2019
Published On Sep 13, 2019
It is a widely known fact that the Indian economy is in the doldrums. So much so that there is hardly a business sector in the country that has not borne losses in recent times. According to the Akhil Gujarat Truck Transporters' Association (AGTTA), as if the other prevailing economic factors were not enough, the monsoon effect has further dwindled the transportation business in the month of August 2019 by good 28%.
"Truck movement is usually lower in the monsoon. However, this is usually compensated for by orders in the run-up to the festival season. This year, the situation is much worse as the economic slowdown in various sectors has hit the transport sector hard. There is near-zero movement in the garments sector, which usually has a lot of movement in the run-up to the festive season", said Mukesh Dave, president of AGTTA. If we look at the statistics, around 2.5 lakh commercial vehicles out of the total of 9 lakh in the state of Gujarat are out of business at the moment.
The retardation in the transport business has also affected the collection of value-added tax (VAT) on diesel and petrol. Compared to the collection of ₹ 1,865 crores in August 2018, the state goods and services tax (SGST) department has been reported to have accumulated ₹ 1,816 crores (-49 crores) in the form of VAT on petrol and diesel in the same month this year.
Moreover, the slowdown of construction activities during the monsoon season along with a decline of orders from the fast-moving consumer goods (FMCG) and consumer durables sectors has affected the transportation business bit time. "Automobile sales are in low gear and this has the transport sector too. During Ganesh Chaturthi or ahead of the Navratri and Diwali season, car and two-wheeler showrooms used to stock up on vehicles anticipating more deliveries. This year, the movement has come down by at least 40%. As far as my company is concerned, against some 250 truck trips last year, we have bookings for barely 120. The slowing automobile sector has also hit transport orders from ancillary units to manufacturing facilities", said Nimish Patel, who owns a transportation business.