India Truckers End 8-Day Strike After Meeting With Government

(Bloomberg) -- Indian truckers ended their eight-day strike after the government agreed to consider most of the demands set forth by the transporters.

“Government has given us hope, that though not immediately, diesel prices may reduce by five rupees to six rupees a liter in a couple of months,” Kultaran Singh Atwal, chairman of All India Motor Transport Congress said in New Delhi today.

The strike called by the All India Motor Transport Congress, which affected about 9 million goods carriers, was over a reduction in diesel prices and rationalization of taxes.

“The government looks forward to working with the entire transport industry,” Finance Minister Piyush Goyal said via a Twitter post today. The government has had discussions on problems related to Goods and Services Tax and other taxation-related issues, Goyal said in a tweet.

The government will put in place a mechanism within six months to ensure seamless movement of transport vehicles across toll plazas with the help of technology, according to a transport ministry statement tweeted by Goyal.

Sugar prices in Mumbai have surged about 20 percent since July 18 on dwindling supplies from mills, Praful Vithalani, chairman of the All India Sugar Trade Association said Friday. Cooking oil refiners have struggled to get raw materials, while the delivery of finished goods has been disrupted, said B.V. Mehta, executive director of the Solvent Extractors’ Association of India.

An end to the strike spells relief for Prime Minister Narendra Modi, who risked being cornered by the opposition over rising prices ahead of general elections next year. Opposition parties in recent months have launched a united drive against the government over alleged graft and mob-violence.

The strike resulted in a revenue loss of about 40 billion rupees ($582 million) per day for the participating truckers, Harish Sabharwal, vice president of All India Motor Transport Congress said earlier on Friday.

The leaders of the association met transport minister Nitin Gadkari on Thursday to press for their demands, including bringing diesel under a new national goods and services tax for uniform pricing and the removal of toll barriers on highways. The group also met interim Finance Minister Piyush Goyal on Friday, Sabharwal said.

Refineries Shut

As many as four edible oil refineries in the western state of Gujarat have been shut because of poor supplies of crude oils, Mehta said. Cotton shipments from warehouses to ports were also hit, said Atul Ganatra, president of the Cotton Association of India. Spinning mills that run “hand to mouth” for raw materials were facing shortages, he said.

The strike has “severely impacted” the country’s automobile sector in the last two days, Sugato Sen, deputy director general at the Society of Indian Automobile Manufacturers, said in an emailed statement. SIAM’s members, which include the nation’s biggest car makers, are facing an unprecedented crisis and many domestic consignments are held up on roads, disrupting supply chains, he said.

Sugar wholesalers in Mumbai will be out of supplies and won’t be able to meet demand from the retailers from Saturday, Vithalani said. More than 200,000 tons of sugar -- meant for sale under a quota program in July -- is yet to be lifted from mills in Maharashtra, India’s second-biggest producer, he said.

Congestion Threat

Millions of trucks that have been off the roads since last week could potentially lead to congestion at LPG import terminals, tanker-tracking and intelligence firm Kpler said in a report on Friday. Some terminals are unable to clear the liquefied petroleum gas storage tanks at the required pace due to a lack of transportation, the report said.

While bulk of the petroleum fuels, such as LPG, diesel and gasoline, are dispatched from refineries through pipelines and rail, the last mile distribution is through trucks and tankers. Indian Oil Corp Ltd., the biggest refiner, hasn’t yet faced difficulties in moving products across the country, Executive Director Sunil Mathur said.

The state-run fuel retailer faced only three incidents of LPG movement disruptions since Thursday evening, but those have been resolved, he said.

--With assistance from Saket Sundria, Debjit Chakraborty, Ann Koh and Rajesh Kumar Singh.

To contact the reporters on this story: Pratik Parija in New Delhi at pparija@bloomberg.net;Anurag Kotoky in New Delhi at akotoky@bloomberg.net;Dhwani Pandya in Mumbai at dpandya11@bloomberg.net

To contact the editors responsible for this story: Phoebe Sedgman at psedgman2@bloomberg.net, Atul Prakash, Karthikeyan Sundaram

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