On Thursday afternoon, Sadashiv Gaikwad and his group of fellow truck owners sat in their union office in Mumbai, glued to the television. On the news, the central government had announced that toll tax would stay suspended on national highways till December 2. Later, the Transport Ministry said that highway toll booths across the country would accept old Rs 500 notes till December 15.

Both these measures, announced a fortnight after notes of Rs 500 and Rs 1,000 were demonetised, were meant to provide relief to India’s ailing road transport sector. But Gaikwad and the other transporters around him did not look reassured at all.

“It is nice of the government to keep toll tax cancelled for one more week, but honestly, not paying toll has not made much of a difference to us in the past 15 days,” said Gaikwad, a member of the Wagle Estate Lorry Owners Association, a small union of 110 truckers in and around Mumbai. “Toll is not our biggest expense. Our lives have been hit because there is hardly any cash in the system.”

Sadashiv Gaikwad (centre) with other truck owners in Mumbai.

Gaikwad’s statement sums up the plight of millions of Indians employed in the road transport industry, from truck owners and bus operators to drivers and load-carriers. Since demonetisation came into force on November 9, the severe shortage of cash has crippled not just the transport sector, but also every other industry that depends on trucks that ferry essential commodities across the country.

In the midst of complete uncertainty about when business will get back to normal, transporters believe that the central government’s toll tax exemption is grossly inadequate.

Math that doesn’t add up

“For the past two weeks, more than half our vehicles have been lying idle, because 80% of this industry is cash-based and will always be cash-based,” said Kultaran Singh Atwal, chairman of the All India Motor Transport Congress, a union representing more than 9 million truckers across the country. “When our vehicles don’t run, the entire supply chain of perishable goods, food, or medicines gets stuck too,” he said.

For a goods-carrying truck to cover at least 300 km a day, a truck owner needs to spend between Rs 15,000 to Rs 18,000 to cover the costs of fuel, toll tax, the driver’s meals and the daily wages of labourers loading or unloading the truck. A truck owner with a fleet of five vehicles, then, would need anything between Rs 75,000 to a lakh per day to run his business – more than Rs 5 lakh a week.

“But the banks are allowing us to withdraw just Rs 50,000 a week from our current accounts,” said Atwal. “The math simply does not add up. How do we operate our trucks?”

Gaikwad, meanwhile, cannot even withdraw Rs 50,000 a week. Most small truck operators, like him, do not have current accounts. And the weekly withdrawal limit from savings accounts has been Rs 24,000 for the past two weeks. “The joke is that many banks don’t even have that much cash to give – I have been getting just Rs 2,000 every time I go stand in the line.”

Increasing the withdrawal limit from bank accounts, then, is one of the main demands that truck owners have from the government.

EMI woes

Another major concern for truck owners is the status of their loans and Easy Monthly Instalments. On November 21, the Reserve Bank of India granted a 60-day relaxation period on the repayments of housing, car and farm loans. But Shivaji Mane and Sachin Pale, both members of the Wagle Estate Lorry Owners Association, claim they are not sure if this relaxation applies to their truck purchase loans as well.

“Right now, 60% of my business is at a complete standstill, and the little I earn is barely enough to feed my family,” said Pale, who is paying long-term EMIs on seven of his 10 trucks. “The government should either let us postpone the payments, or better still, waive the instalments for a few months completely.”

Going hungry

If truck owners are in a fix, drivers and labourers have been hit even worse. On several occasions in the past two weeks, Gaikwad claims his truck drivers have returned hungry from long journeys, because they simply did not have the cash to eat at roadside dhabas.

“Even if they stock up on fuel or pay old notes at some petrol pumps, getting smaller notes for eating food has just been impossible,” said Gaikwad, who claims he will be unable to pay his drivers their monthly salary this month. “When owners themselves are barely earning, how are we to pay others?”

Among those who has not received any pay is Mahadev Kasurdi, a 65-year-old daily wage hamali worker (load carrier) who used to earn between Rs 400 and 600 a day by loading and unloading goods for truck owners at the Thane-Mumbai border. “For 15 days now, I haven’t earned anything,” said Kasurdi. “Even though vegetables have now become cheaper, I have now started eating less.”

Mahadev Kasurdi, a daily-wage load carrier.

According to Pale, the real solution to the current cash crisis is not just waiving toll tax but pumping the economy with currency notes once more. “The Rs 2,000 note is useless, we all agree. If the government wants things to normalise, it needs to reintroduce new Rs 500 and Rs 1,000 notes in the same quantity as before.”

The current situation, says Gaikwad, is unique and worse than a recession. “In a recession, at least people have cash.”