The Indian Federation of App-Based Transport Workers (IFAT) and the Telangana State Taxi and Drivers Joint Action Committee have written to the Reserve Bank of India asking for the moratorium on loans to be extended to December 31, 2020, as the transport sector highly suffered due to the lockdown.
Most transport, especially app-based transportation, came to a halt due to the lockdown, robbing many of a source of income overnight. They have since restarted, but according to IFAT, operators are just breaking even because EMIs are under moratorium.
The road transport sector in India is highly distressed. It is reeling in deep financial crisis due to fallout of Corona induced lockdowns and there is little hope of its revival in the current Financial Year (sic),” IFAT’s National General Secretary Shaik Salauddin said.
It added that it impacts over 20 crore people who are directly or indirectly affected by the sector, including Ola, Uber, Swiggy and Zomato workers. The government has also acknowledged these workers, engaged in ferrying passengers or in delivery, to be essential workers, it said. However, IFAT added, the sector didn’t receive any fiscal benefit.
IFAT said that the price of fuel, penalties, toll and taxes have all increased, increasing operating costs when demand is already subdued. IFAT said that half the people that were on app-based services prior to COVID-19 are still off the roads, and once the moratorium is over, could lead to a spurt in Non-Performing Assets of banks as they will not be able to repay their loans.
“At present the app-based drivers and delivery workers are not earning anything significant and are unable to pay their EMIs or loan instalments, but they are being hounded by the recovery agents of Banks, NBFCs and Private Financiers to pay up their EMIs or face seizure of their vehicles,” IFAT said.
The demanded that the moratorium be extended upto December 31, interest be waived off for this period, and financial assistance of upto Rs 5 lakh under the Mudra Loan Scheme for transport permit workers.