Diesel accounts for 65% of the cost of transport. Therefore, the direct effect of increasing its price has a bearing on the freight rates.
Due to diesel being expensive, the cost of freight has increased and by citing this increased cost, transporters are preparing to increase the freight rates. According to him, it is necessary to increase by 15 percent. Due to this, it will directly affect inflation.
- February 26, 2021, 6:11 PM IST
In the last two months, the price of diesel has increased by only about 10 rupees in Delhi alone. Diesel is Rs 81.32 per liter on Friday in Delhi. Whereas in Bhopal it has reached Rs 89.65. Three months ago, on November 17, it was Rs 77.95. That is, there has been a jump of about 12 rupees or 15 percent in it. Pradeep Singhal, chairman of the All India Transport Welfare Association, says that the cost of transport has increased due to the increase in diesel prices. Not only this, if diesel prices are seen from the time of lockdown last year, then it has increased by an average of 25 percent. Sanitization, toll, insurance and maintenance costs have also increased. Overall the cost of transport has gone up by about 30 to 35 percent. Demonetisation was reduced due to Coronation, so it is not possible to increase the fare significantly. Nevertheless, it is necessary to increase the freight rates from 15 to 20 percent.
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Freight rates have not increased since 2012Naveen Kumar Gupta, spokesperson of All India Motor Transport Congress (AIMTC), an organization of about 90 lakh truck honors, says that diesel rates have been steadily increasing for the last few years, but the freight rates are the same as 2012 due to lack of demand. In view of the rising costs, transporters are now considering increasing the freight. AIMTC West Zone President Vijay Kalra said that we have decided to increase the fare from 20 to 25 percent. A formal decision will be made soon. If transport becomes expensive, it will affect all types of products including vegetables and groceries.
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10 percent increase in freight on fruits and vegetables
MR Sipalani, president of Delhi-based Azadpur Sabzi Mandi, says that the demand is not high at the moment, so the increase in freight has come down. Wholesale vegetable trader Pawan Khatik says that the contribution of freight in the total price of fruits and vegetables is up to 30 percent, so if the freight increases by 10 to 20 percent, then vegetables will also become expensive by 10 percent.
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How is the impact of expensive diesel
AIMTC West Zone President Vijay Kalra said that diesel accounts for 65% of the cost of transport. 20-25% share is for maintenance, loan installment etc. If a truck (16 ton) is booked from Indore to Chennai for 65 thousand rupees now, then it costs about 40 thousand rupees of diesel. There are 25 thousand left with the transporter, in which the expenses of maintenance, driver’s salary, installments and earnings etc. are incurred. Now the cost of diesel will increase by 8,000 to 48 thousand rupees. Only 17 thousand will be left for other expenses. This can only be offset by increasing the rate of the fare.