For the 46-year old former Army driver Amrik Singh, the last fortnight has been nothing short of hell. The demonetisation move has literally driven his trucking business to the ground. He has six trucks but only two drivers, as four drivers have left due to the cash shortage.

His last driver abandoned the truck at a petrol station in Rajasthan, with keys in the ignition switch. Singh had to travel all the way from Himachal Pradesh and make the delivery in Mumbai.

The Kargil war veteran says plying trucks on the highways is worse than driving trucks for the Army, “In the Army, life was not assured, but at least your next meal was,” he says, with exasperation.

Industry estimates that about 75,000 trucks are still stuck on highways due to the currency shortage.

In the first week after demonetisation, about 4 lakh trucks were stranded across the country.

For Nawany Corp, a Mumbai-based logistics and trucking firm with 150 vehicles, which primarily serves the cement majors, the business is down by 25-30 per cent.

Chairman Ashok Nawany said the trucking business is driven by cash-in-hand for drivers, but with liquidity under stress, business has suffered.

Some banks that provide working capitals loans and other loans to the transportation sector, have placed facilities such as overdraft on hold. Banks have started negatively rating transporting companies, he said.

Low credit profile

A section of bankers has taken a view that demonetisation has hit the ability of the transportation companies to pay back loans.

As the month end is approaching, salary time is coming closer but banks are hesitant about providing short-term debts, Nawany said.

For Vice-Chairman of Patel Roadways, Areef Patel, who manages 1,500 trucks for his company, business has sunk by 40 per cent since the November 8 announcement. Patel wonders how it would be possible to provide 1,500 credit cards to his drivers overnight for travel expense.

“How can drivers eat at highway dhabas (roadside restaurants) when their cash is of no value? For driving the truck, they have to eat. Some fuel outlets do not accept old notes, who should the drives call for help? The PM or the FM?”, he asked.

Bhavik Chinai, founder and CEO of Vamaship, a logistics aggregator, said that most ATMs in rural areas are yet to be recalibrated for new notes. Therefore, the goods deliveries are getting delayed. But on the other hand, due to currency issue, use of Paytm and aggregating platforms is rising.

Because of the crisis, shippers are getting directly connected with transporters. The transactions are happening through cheques plus the middlemen are getting pushed out of the business, he added.

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