Economic Slowdown in Tamil Nadu Raises Alarms as Logistics Costs Continue to Rise

Tamil Nadu’s truck operators and entrepreneurs from the southern region are grappling with rising logistics costs, exacerbated by the proposed toll fare hike set to take effect from Monday. This increase in transportation expenses comes at an inopportune time when the industry is already reeling under the strain of an economic slowdown.

Thoothukudi seaport serves as a significant origin point for most of their shipments, which then travel through numerous toll plazas en route to destinations like Tirupur. Consequently, any toll fare hike carries substantial weight, further burdening the already strained logistics sector.

JP Joe Villavarayar, president of the Tuticorin Port Transport and Equipment Owners Association, expressed concern over the impending 5% toll hike, describing it as a harsh burden to manage. Before the increase, toll charges alone amounted to a substantial Rs 3,500 for a cargo trailer traveling from Thoothukudi to Tirupur. With the revised toll fees, these charges will escalate further, ultimately weighing heavily on consumers.

The truck operators have already borne the brunt of extraordinary increases in diesel prices, road tax, and GST on cargo transportation. Now, they are forced to shoulder the additional burden of toll fare hikes, compounding their financial woes, according to Joe Villavarayar. He highlighted the recurring road tax of Rs 11,000 charged every three months for a cargo trailer, on top of the toll fares. Ironically, despite these extracting costs, some stretches of highways remain in deplorable condition.

Also Read:- Addressing Challenges in Indian Trucking: Drivers, Utilization, and Electrification

The stakeholders are demanding that the government take over and manage toll plazas once the initial ten-year toll road contract expires for a concessionaire. This move, they argue, would alleviate the burden on commuters, as there is no point in allowing the concessionaire to continue collecting tolls after recovering their investment.

Amidst reduced cargo volumes and dwindling exports, the annual toll fare hike is seen as the proverbial last nail in the coffin by industry representatives. The drastic fall in salt production in Tuticorin, once transported to most South Indian states, has further compounded the challenges faced by the logistics sector, according to K Samuel, former president of the Tuticorin Lorry Owners Association.

The convergence of economic headwinds, escalating transportation costs, and infrastructural deficiencies have created a perfect storm for the logistics industry in Tamil Nadu, prompting calls for immediate action from relevant authorities to address these pressing concerns.

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