Transport Sector Hit Hard by Diesel Price Hike; Are Transporters Taking Trucks Off the Roads?
The continuous rise in diesel prices is now taking a heavy toll on India's transport sector. Grappling with escalating fuel costs and supply-related bottlenecks, many transporters have begun taking their trucks off the roads. Approximately 20% of the country's 95 lakh trucks—amounting to nearly 19 lakh vehicles—are currently off the roads.
As diesel becomes increasingly expensive and its availability becomes scarce in certain regions, transport companies have also hiked freight charges. On key routes connecting Western and Northern India, freight rates have reportedly surged by 10% to 15%.
The impact is being felt even more acutely by local transport services, which typically cover short distances of up to 30 kilometers. Industry experts warn that the rising cost of transportation could lead to price hikes for vegetables, fruits, groceries, and other essential food items in the coming days.
Massive Surge in Fuel Prices
State-run oil companies have hiked the prices of petrol and diesel four times over the last two weeks. Cumulatively, fuel prices have risen by approximately Rs 7.5 to Rs 8 per liter during this period.
Consequently, long queues of trucks are now being witnessed at petrol pumps along national highways, where drivers are waiting for hours to refuel their vehicles.
Small Operators Worst Hit
This situation has become particularly dire for small transport operators, who account for over 70% of India's truck transport industry. Harish Sabharwal, National President of the 'All India Motor Transport Congress,' stated that diesel accounts for approximately 40% to 45% of the total operating costs incurred in running a truck. According to him, small operators are no longer able to bear the burden of the continuous rise in fuel prices.
He further explained that many petrol pumps have now stopped supplying diesel on credit, creating a severe cash-flow crisis for truck owners; consequently, many of them have been compelled to suspend their operations temporarily.
Bulk Diesel Now More Expensive Than Retail Diesel
Another major factor contributing to this turmoil is the widening disparity between bulk and retail diesel prices. Following the government's recent hike in industrial diesel rates, bulk diesel has become costlier than retail fuel by Rs 40 to Rs 42 per liter.
Due to this price differential, large companies and industrial entities—which previously purchased fuel in bulk—have now begun procuring diesel from standard retail petrol pumps. This shift has led to increased congestion at fuel stations and has placed significant pressure on retail fuel supplies.