Day after the Himachal Pradesh government increased value added tax (VAT) on diesel, two major truck unions operating in the state have increased the freight rates up to ₹1.50.
Diesel became costlier by ₹3 in Himachal after the government increased VAT from 7.40% to 10.40% on Friday.
With this, the per litre diesel price in the hill state has shot up to ₹88 but is still cheaper than the neighbouring states of Haryana ( ₹90.36), Punjab ( ₹89.04) and Uttarakhand ( ₹90.56).
Consequently, Nalagarh Truck Union, which is the Asia’s largest truck union with a fleet of more than 10,000 trucks, has increased the freight rate by 90 paise per kilometer per tonne for small trucks and ₹1.50 for big trucks.
DK Kaushal, general secretary of Nalagarh Truck Union, said that the freight rate hike is in consonance with the agreement with Baddi-Barotiwala-Nalagarh Industries Association (BBNIA).
MoU empowers the truck union to hike freight rate by 30 paise per kilometer per tonne for small trucks per ₹1 increase in diesel prices and 50 paise for big trucks.
The truck union cuts the freight charges accordingly when diesel prices come down. Kaushal said that the new freight rates became effective from Saturday.
Bilaspur District Truck Operators Co-operative Society (BTDS), another major transport union, has also increased the freight by 1.41% in accordance with their predetermined formula. In simpler terms the freight rates have been increased by 15 paise per kilometer per tonne for single-axle trucks and 13 paise per kilometer per tonne for multi-axle trucks.
With this the freight charges for single axle trucks have now gone up to ₹10.45 per kilometer per tonne and ₹9.43 per kilometer per tonne for multi-axle trucks, said BTDS general secretary Pradeep Thakur.
The hike in freight by the truck unions would result in an increase in the construction material and other commodities.
Paonta Sahib Truck Union President Baljit Nagra said they would also raise the demand to increase freight rates by ₹1.50 per kilometer per tonne during the meeting with Paonta Chapter of State Chamber of Commerce.
A demand has also been raised by various truck unions to increase the freight rates for apple transportation.
Notably, the state government has raised VAT on diesel for the second time in seven months.
Earlier, it had hiked the VAT by ₹3 in January, a month after taking charge in the state. This time decision has drawn criticism from opposition parties like BJP and CPI (M) who questioned timing of the hike, saying it had been carried out when the state was coping with a natural calamity. However, chief minister Sukhvinder Singh Sukhu justified the hike saying that it was imperative to mobile resources.