January 5, 2009 / 11:05 AM / 9 years ago

Tens of thousands of truckers strike in India

<p>Trucks are parked at a terminal during the nationwide transport strike in Mumbai January 5, 2009.Punit Paranjpe</p>

MUMBAI (Reuters) - Tens of thousands of truckers stayed off the roads on Monday after talks with Indian officials to cut taxes and diesel prices broke down, threatening to push up prices of food and commodities across the country.

"We are on an indefinite strike until our demands are met," said Charan Singh Lohara, president of the All India Motor Transport Congress, which says it represents 6 million trucks across the country.

"The government is giving concessions and bailout packages to so many industries. Why not us, when we are struggling to repay loans with high fuel prices, high prices of tires and numerous taxes," he said.

More than 70 percent of freight in India moves by road, and truckers had benefited from a booming economy that required the transport of steel and cement, as well as an improving network of highways that encouraged demand for trucks.

But the country's 200,000 transport companies have been hit in recent months by a slowing economy, higher interest rates on vehicle loans and greater competition from the railways.

Sales of trucks and buses at Tata Motors, India's top vehicle maker, fell by more than half in December from a year ago.

<p>Trucks are parked at a terminal during the nationwide transport strike in Mumbai January 5, 2009.Punit Paranjpe</p>

"How can we compete when our costs are so high," Lohara said.

India cut prices of petrol and diesel on December 8 after crude oil tumbled, but the economy, Asia's third largest, has shown palpable signs of slowing amid a global financial crisis, after growing at 9 percent or more in the past three years.

<p>Trucks are parked at a terminal during the nationwide transport strike in Mumbai January 5, 2009.Punit Paranjpe</p>

Economists and government advisers expect expansion to moderate to around 7 percent this fiscal year to March 31.

Talks with the government would continue, Lohara said, but a prolonged strike could nudge up prices of fruits and vegetables and disrupt supplies of other commodities.

A three-day trucker's strike last July calling for lower road tolls and cheap diesel had pushed up prices of produce.

Big retailers stocked up and made arrangements with their own fleets to ensure supplies were not hit, said Rajan Malhotra, chief executive of Big Bazaar in Mumbai.

"We are well-stocked for the next 3-4 days, but if the strike drags on beyond that, then we will face shortages," he said.

Reporting by Rina Chandran; Editing by Alistair Scrutton and Jerry Norton

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