Transportation cartels make goods dearer


Apr 8, 2016-

Market prices of daily essential commodities have soared as a result of transportation cartels and higher freight charges, traders said. 

Cargo fares have jumped by Rs5,000 in the last one month. Traders said that the charge for hiring a 10-tonne truck had gone up from Rs18,000 to Rs23,000. This has led to a rise in the shipping costs of essential goods by Rs1 per kg.

The transportation syndicate in Birgunj has been implementing an odd-even system since March under which trucks with an odd licence plate number ply on odd dates and those with an even number are allowed on the roads on even dates.

Using this system, the Tarai Transporters Association (TTA) allows a truck to load cargo every four days which has limited the number of trucks available for hire. Traders have accused the police administration of acting in collusion with the syndicate. 

Pradeep Kedia, president of the Birgunj Chamber of Commerce and Industry, said they had started a campaign to end the syndicate system. “It will not only affect traders but also hit the supply system throughout the country.”

The transportation cartel that controls the Birgunj-Kathmandu route has slashed the number of trucks available for hire from 10-12 trucks per month to six-seven. “Transporters have started setting cargo rates arbitrarily citing a shortage of trucks,” said a trader.

Following the establishment of the syndicate system last year, shipping charges surged by up to Rs8,000 per consignment. The Supreme Court had ruled five years ago that all types of syndicates, cartels and related activities were illegal, but nothing has been done to remove them. 

A trader accused the government of being reluctant to control such activities. Similarly, political parties have been accused of protecting these cartels. However, transporters have defended the odd-even system saying it is designed to reduce traffic congestion. Shankar Bista, secretary of the TTA, said they had implemented the system in order to reduce the flow of an excess number of vehicles on the streets and highways. 

Kedia said that transporters had been enforcing the syndicate system in a planned manner. He said that the business community would not tolerate any type of measure that would affect the norms of an open and competitive market.

As per the TTA, 2,400 trucks are associated with the alliance. The association has been rationing trucks through loading cards that it has provided to transporters. 

According to a truck driver, trucks cannot be loaded without the card. The syndicate charges a membership fee of Rs100 per truck and an additional fee of Rs250 per loaded truck through its office in Pathlaiya.

According to Harendra Yadav, president of the Transport Association, Birgunj, an estimated 7,000 trucks carry goods from Birgunj daily. Based on this figure, the TTA collects Rs1.7 million from the transporters daily.

Published: 08-04-2016 08:15

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