Guj transporters mull 20% tariff hike

Estimates suggest Gujarat also consumes around 80 million litres of petrol per month.

The association is already mulling a rise in transport tariffs by 20 per cent. "There are roughly 4.5 lakh diesel transport drivers in Gujarat who will be hit by the price hike. Moreover, the fuel hike will have a cascading effect on the industry overall, from auto rickshaw drivers to industrialists," said Vasan Ahir, president of Akhil Gujarat Truck Transport Association. There are 3.61 lakh vehicles in the state including 2.5 lakh trucks, 23,000 tankers, and 1.35 lakh other commercial vehicles wherein each vehicle travels around 350-400 kms per day and consumes around 100 litres of diesel per day.

The association members are already facing a tough time amidst rising oil and tyres prices. "The transport industry in Gujarat is going through a bad phase. Already we are reeling under rising prices of oil and tyres. Now with the fuel prices heading north, it is only adding to our woes," said Hiten Vasant, executive member of AGTTA.

Incidentally, the price of diesel in Gujarat is the highest in the country compared to other states. The state levies an additional value added tax (VAT) of 24 per cent on diesel leading to a total rise in price by Rs 3.75 per litre.

AGTTA also alleges that the state government takes home close to Rs 8,000 per 10,000 litres of diesel through VAT and cess. Apart from a levy of Rs 6,653 of VAT per 10,000 litres of diesel, the state charges around 3 per cent of cess amounting Rs 1,031, 3 per cent additional VAT on cess amounting to Rs 247, and VAT on dealer commission amounting to Rs 151 per 10,000 litres of diesel.

Members of the association have asking the state government to restructure VAT to ease the presssure on fuel prices. "The state government can take a cue from Centre which restructured excise duty and custom duty before announcing a price hike," said Vasant.

The tariff for Ahmedabad-Mumbai route comes to around Rs 12,000 per trip while that of Ahmedabad-Delhi route costs Rs 17,000 per trip. The association will meet the All India Motor Transporters' Association on June 7, 2008 to discuss the fuel price hike.