Home / News / India /  Freight rates up by 25% due to hike in diesel prices: AITWA

New Delhi: The surging diesel prices have led to an increase in freight rates across modes of transport as the rates have increased by 25 per cent, said Chairman of All India Transporters Welfare Association (AITWA) on Tuesday.

"30 to 35 per cent increase in the diesel price has contributed around 25 per cent to 30 per cent increase in the freight rates for the last one year for Full Truck Load (FTL) deals, which are generally between big transporters and companies," said Pradeep Singal, Chairman, AITWA.

Explaining the impact of the continuous hike in fuel prices on the transport industry, Singal said, "We are not able to deliver instantly to our customers in such a competitive market. We have our annual, semi-annual contracts, and if the consignment has been left to us, it is not possible for us to charge more from the client later on. So, some portion of it has to be absorbed by the transport organisation and it is really impacting our profitability and also our cost of operation has gone up due to increase in the diesel prices, which has increased our capital cost."

Requesting the government to reduce the prices, Singal said, "Inflation is increasing, it is going to impact all the industries. We should have a uniform price of diesel all over India, which will help us as we would not send our trucks to places only where diesel is cheap."

He further suggested that the increase or decrease in diesel prices should be done only once a month so that the dealers can adjust their contracts and renegotiate with companies.

The small transporters' conditions are worse due to the increase in freight rates.

Haryana Freight Carrier, Director, Subir Agarwal has who has his office at Transport Nagar, Ghaziabad and takes booking for Jharkhand and Bihar says that people like him are suffering due to the price rise.

"Our booking charges are the same for the last two years. We are booking parcels at the rate ranging between 5 per kg to 7 per kg. In October 2020, we were paying freight charges of 66,000 per truck, which have a loading capacity of 15 tonne for Delhi to Ranchi or Delhi to Jamshedpur. Now, we are forced to pay 90,000- 95,000 per truck having a loading capacity of 15 tonne," Agarwal said.

Speaking to ANI, owner of New Habibi Transport Corporation, Sonu said, "Today the diesel rate is around 82 per litre for us, which is the reason behind the freight hike. Our trucks cover a distance of 2,800 km if we transport goods to Ranchi. The average mileage of truck is 4 km per litre and the diesel is around 10- 12 since October 2020, so we have to pay around 8,000 more for fuel than what we were paying in October."

Since October 2020, the oil marketing companies have increased the petrol prices by 10 per litre and diesel prices by 11 per litre in the metro cities to boost revenue and recover the pre-COVID price levels.

After the 16th revision of prices in February, petrol reached a new record of 91.17 per litre in Delhi and diesel has touched the height of 88.60 per litre in Mumbai on Saturday.

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