Note-ban? delays goods? transport

Ten days after Prime Minister Narendra Modi?s dramatic announcement of demonetisation, now being called notebandi (financial vasectomy), created unprecedented nationwide cash crisis and chaotic queues outside banks, comes a grim warning about an unfolding scenario: staggered truck movement in different parts of India is slowing down transportation of goods, essential and perishable commodities which is likely to create scarcity and trigger price rise, sooner rather than later. Demonetisation of the Rs.1000 and Rs.500 currency notes has adversely hit logistics industry as 80-90% of trucks are getting delayed or stranded on highways for shortage of cash. ?These trucks are stuck up across Indian roads due to inability of transporters and drivers to carry acceptable cash,? said Lokesh Gupta, Co-Founder-Director of the New Delhi-based Load24x7, India?s first transportation mobile application. Nearly one crore commercial vehicles currently ply on Indian roads. The startup, which began operation in July 2015, now has nearly five lakh trucks listed with it, besides over 20,000 mobile users, 50,000 transporters, 5,000 packers-and-movers and 200 advertisers. Nearly two lakh of these trucks were stranded or delayed for 24 to 48 hours in the northern states alone, he told BusinessLine. After November 24, when highways would resume charging toll tax, the crisis could only aggravate as cash, now being hoarded by many of those who withdrew it, remains out of circulation in the markets. Markets at many places either wear a deserted look and simply shut down by evening for want of cash. Neither the shopkeeper nor the buyer has cash; even if they have, they refuse to part with it. ?In the short-term, 50-70% of our drivers are affected as, due to scarcity of low denomination cash, they cannot get timely services like spare parts, mid-way maintenance, tyre servicing, food etc. They are, however, getting fuel so far.? Crippling cash shortage is threatening normal delivery of goods to consumers and business, he said. All India Motor Transport Congress has demanded to increase the cash withdrawal limit to Rs.20,000 per day for the truck drivers. The industry is facing difficulty in goods supply, manpower and payment as truck drivers suffer due to improper payment for their needs that also affects their domestic life. ?The economy has stopped working since the last week as money flow has been stuck. This is affecting transportation very badly. The delivery of day -to- day goods to consumers and business is also hampered, and is likely to snowball into a major goods shortage situation in the market.? Gupta, however, expressed optimism that this short-term problem may result in a long-term solution for what ails the country?s economy. Bengaluru-based B2B trucking player Blackbuck, that networks around one lakh trucks at 220 locations across India, had made its financial operations payable online and even issued prepaid cards for various expenses, which the drivers could also use to draw money at ATMs. But this is not enough. ?They also need cash for on-road expenses. A lot of traditional trucking operations run on cash which is difficult to get these days. This delays transportation,? said Chanakya Hridaya, Co-Founder, Blackbuck. Courtesy: The Hindu Business Line


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