All India Motor Transport Congress

AIMTC

Business Insider

Delhi NCR

If the current scenario continues, basic essentials in the market from food items to medicines will be badly hit. The demonetization move by the government has put withdrawal limit on cash, both from bank and ATMs. As per the directive, one can withdraw upto Rs 10,000 per day with the maximum limit per week being Rs 20,000.At such a crucial juncture, the apex body of passenger and cargo transport,(AIMTC) has said that the financial crunch has badly hit the transport sector .covers up to 3,500 taluka, districts and state level federations and transport associations."AIMTC submits that the limit of Rs 10,000 withdrawal per day and maximum of Rs 20,000 per week is minuscule and has paralysed the transport business which is poised to come to a standstill," the apex body of cargo and passenger transporters told"Our industry is mostly cash driven. Almost 80% of transactions are done through cash," the spokesperson added.This move has posed as a hurdle in their day-to-day operations. The spokesperson also defended his demand saying CNG gas stations acrossonly accept cash. And as per government's directive, commercial vehicles need to ply on CNG.Rs 1,194 crore is required on a daily basis by the transport sector for its operations. A small operator having 10 trucks would require up to Rs 3 lakh and 50 thousand every day. As per the finance act section - 6D(d) of IT Act – Rs 35,000 per truck per trip is allowed for en route expenses.The badly timed demonetization comes at a time when nearly 2 lakh trucks that are 15 years old would be scrapped out of road today. This means the daily supply of milk, food items, vegetables, medicines will be badly hit. The traders aren't very sure if this sudden stop in supply would lead to price rise and inflation.Most traders associated with local markets dealing in perishable food items told Business Insider that their daily sale has dipped from 25% to 50%. With online groceries making full use of the situation, their fixed customers are buying in credit. With the money flow in the market having gone down, it's turning to be a disaster.