Transportation Sector, the Heart of India’s Economy, Goes for a Facelift
The trucking industry in India, for a substantially long period of time, has not received the attention and recognition that it deserved. It is an area that is ripe with potential and yet the resources are far from being efficiently utilized.
Photo Credit : ntaindia.net,
Large American trucks boasting elegant style along with massive cargo capacity, enhanced with technological infusions such as GPS navigation and satellite communication links might have sounded like a distant reality for the Indian transportation industry a few years. But over time, evolved technological and economic infrastructure of the country along with direct involvement of the corporate sector is rapidly scaling up the efficiency and viability of the industry. This has increased the scope of advancement and modernization in the field of trucking, making the goal of a more viable Indian transportation sector much more approachable.
The trucking industry in India, for a substantially long period of time, has not received the attention and recognition that it deserved. It is an area that is ripe with potential and yet the resources are far from being efficiently utilized. However, there is massive demand for smooth freight transportation services in India, especially with the growth of the country’s economy. This has also encouraged the influx of new companies into the sector, one which was previously often neglected.
If we see the sector five years down the line, there is a huge growth potential because of various factors as mentioned below:
a) Improved Road Infrastructure - India has the second largest road network across the world at 4.7 million kilometers. This road network transports more than 60 per cent of all goods in the country. The construction of highways had reached an all-time high of 6,029 km during FY 2015-16, and an accelerated pace of construction is expected to continue for the coming years. The government, through a series of initiatives, is working on policies to attract significant investor interest. The Indian government plans to develop a total of 66,117 km of roads under different programmes such as National Highways Development Project (NHDP), Special Accelerated Road Development programme in North East (SARDP-NE) and Road Requirement Plan (RRP) in Left Wing Extremism (LWE) affected areas. It has set an objective of building 30 km of road a day from 2016 onwards.
b) Improvement in Quality of Vehicles Manufactured– Gone are the days when trucks were manufactured just to ship goods. As drivers usually spend a significantly high amount of time on road, truck manufacturers are now gearing up to provide all-round comfort while driving on long routes. Vehicle manufacturers including Volvo, Tata, Mahindra, along with others are offering trucks that are well-equipped with Air Conditioned Cabins, Comfortable seating, GPS Tracking, Maintenance tools and Medical Support Systems.
c) Increase in Earning Opportunity for drivers– The innovative concept of passenger transport aggregation through mobile-based platforms such as Ola and Uber has helped drivers, previously struggling to earn INR 10 thousand to 15 thousand per month, to achieve their actual earning potential of more than INR 40-50 thousand per month by leveraging technology. Many logistics companies are working on similar models, thus creating an opportunity for truck drivers and transporters to boost their earnings significantly.
d) Next Generation of Drivers - Truck drivers play a major role in our transportation system. They travel across the length and breadth of the country, even in the most unfavorable climatic conditions of various regions to ensure that the goods consignments reach their destination within the specified time. Unfortunately, however, truck drivers often have to lead a pitiable lifestyle in the course of fulfilling their obligations. They don’t have fixed timings for meals, sleep or rest. Contrary to the truck stops in the West that provide many facilities to truck drivers, there are no such facilities available in India. In our country, the drivers’ truck is considered their home as it provides them shelter when they are on the road. However, things are indeed changing for the better.
Introduction of Transporters Loyalty program from government subsidiaries is a big boon for the drivers’ lifestyle. Various initiatives such as Indian Oil’s ‘IOC-Xtrapower Fleet card’ and Bharat Petroleum’s ‘BPCL Ghar Program’ are providing basic amenities like hygienic lodging and accommodation, medical insurance, and breakdown assistance on popular truck routes. This not only gives the drivers a better travel experience but also provides them a higher amount of mental peace and job satisfaction.
e) Implementation of Goods & Service Tax (GST) – With the implementation of GST, the logistics companies, which are currently forced to set up many small warehouses across multiple cities, can set up relatively less, yet big warehouses pan-India. These will be much more efficient and can follow the hub-and-spoke model for freight movement from the warehouses to the different manufacturing plants, wholesale outlets, retail outlets and various POS. This growth is also backed by the boom in the e-commerce sector and expansionary policies of the FMCG firms. It has moreover increased the service geography of the logistics firms and they are now also liable to meet the demands of quick delivery and tight service level agreements.
f) Focus of new companies in this sector– There are many players who have entered into the transportation and logistics business with innovative concepts and technologies. This competitive environment is helping the industry at large and is taking the sector towards an organized, stable, and a much more efficient and dynamic future. Moreover, these firms are also focusing on providing a better lifestyle to drivers who are, after all, the backbone of India’s transportation system.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house
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