India's Trucking Strike Drives Prices Up

Anjana Pasricha
Voice of America
April 16, 2003

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Truck drivers across India are striking to protest higher fuel prices and a proposed new tax. The strike is pushing up prices of essential items in many parts of the country.

More than 2.5 million trucks stayed off the roads for a third day. Drivers are demanding that the government roll back fuel prices, which have increased by nearly 25 percent in the past three months.

State-run oil companies reduced fuel prices by about four percent. But truckers dismissed it as a "token decrease," and say prices should be cut further since international crude oil prices are on the decline.

A spokesman for the All India Motor Transport Congress, J.M. Saksena, said high fuel prices have pushed up freight costs, and cut profits. "No businessman can run his business if it is running perpetually in loss. So we are compelled to stop our work," he said.

The truckers also want to be excluded from a value added tax, which the government plans to impose June 1. The VAT will replace varying tax systems that currently exist across 38 Indian states. Truckers say the VAT should not apply to them because they are not traders. They also want the government to repeal a new law that bans 15-year-old trucks from the roads.

Talks between the government and the truckers have failed to make headway.

The strike is affecting business across the country. Cargo is piling up at ports, and prices of goods such as fruits and vegetables are on the rise.

Several state governments are using buses and smaller vehicles to ferry food and other essential supplies to towns and cities. Officials say there are no shortages of such items.

But fruit and vegetable sellers say prices have increased more than 20 percent.

In a New Delhi market, fruit-seller Dinesh Gupta said prices for all fruits are up substantially, and in some cases they have nearly doubled.

A New Delhi resident, Meena Sopori is in a fruit and vegetable market making her weekly purchases.

"Yeah, it seems to be it has made a lot of difference," she said. "What was before 15 rupees a kilogram, now, today they are saying it is 20-25, whatever they feel like they are saying."

In many towns, people are stocking up on items such as onions and potatoes, fearing shortages might set in if the strike drags on.

It is estimated that the transport trade and other industries are piling up losses of more than $400 million a day due to the strike.