India’s Transport Sector DURING COVID 19

Transportation sector has been one of the primary victims of COVID-19. From rickshaw pullers to
airlines, all have been affected economically by the pandemic. India's overall energy demand fell by
11% in March 20201.

India implemented a 72-day lockdown in four phases stretching from March 21 to May 31.

 On 19th March, bus services between the cities of Maharashtra and Madhya Pradesh had been
postponed from 21st to 31st March 2020.
 Punjab government imposed a ban on public transport including buses, auto rickshaws and
tempos from 21st March.

As on 1 June 2020:

 199,257 cases of Covid-19 infections and 5,606 deaths

 Test positivity rate: 4%
 Death rate: 3.3%
 India's infection cases: 10 per million people
 Death: 0.4 per million people

Short Term Effect and Long Term Effect

 As the transportation sector employs millions, in the long run, it is necessary to understand the
pandemic's impact on consumer preference and the subsequent transportation demand for
passengers and goods.
 Due to lockdown in many countries, the demand for passenger transport has been adversely hit.
Urban freight segments in India have also had a mixed short-term effect in terms of
transportation demand. There is a surge in demand for truck drivers in transportation of
essential goods.
 Even though the fall in passenger transport demand is pushed by social distancing restrictions,
COVID-19 may have a long-term effect on people's travel behavior.
 Even after the situation normalizes, the perception of risk associated with crowded areas could
lead to shift in preferences towards personal travel modes. That is, people may avoid using
public transport modes to avoid crowds.
 People may also avoid shared mobility modes like autorickshaws, micro-transit vans, e-rickshaws
etc. The drivers employed in app-based taxi services are economically suffering in the short term
due to the COVID lockdown. However, it cannot be said if these modes may face long term
economic effects in terms of reduced travel demand.

Considering this lockdown as a large travel demand experiment, organizations have much to gain
from optimizing transportation of employees in the future, in terms of productivity and costs

Since February, the online food orders have dropped by 20% whereas online grocery orders are
overflowing. It is to yet to be seen whether these acquired habits of online grocery shopping will
sustain after the pandemic passes.
Effects of COVID-19 in logistics industry
The strongest impact of COVID-19 was seen on the 2nd or 3rd day of the lockdown, when movement
of trucks fell by 90% – 95%. The little movement witnessed was of essential goods which had not
come under the purview of restrictions imposed due to the lockdown.
There has, however, been a slow and steady recovery of goods movement through the months of
April and May. This was largely due to relaxations of the lockdown in the non-hotspot regions of the
country.

As of April 30, 40% of the trucks seem to be back on the roads. Primary drivers are Agriculture and
FMCG, with some recovery in industries like metals, chemicals, and infrastructure.

With the loosening of lockdown across the country, the sector bounced back. And growth of this
sector depends upon the demand.
Railways

 On 17th March, Western Railways increased the platform ticket charges from Rs. 10 to Rs. 50
across 250 stations.
 Central Railways cancelled 23 trains.
 On 22nd March, metro services across India were suspended till 31st March.
 On 21st March, in view of Janata curfew, Indian Railways announced the cancellation of 3,700
trains across the country.
 On 22nd March, the union government cancelled all train services in the country baring goods
trains, that is around 12,500 trains, and all non-essential passenger transport including interstate
transport buses.

Flights

 On 19th March, the Government of India announced that no international flights will be allowed
to land in India from 22nd March.
 On 23rd March, the union government announced the suspension of all domestic flights in the
country starting from 25th March.
Indian Railways A Monopoly
 Indian Railways had, until very recently, a monopoly on the country’s rail transport.
 Consumers have no other provider they could use to travel by train Rail networks are often
considered to be a ‘natural monopoly’. This is because only one provider can run a train on a
given track at a given time, so naturally there cannot be competition.
 The railway network could be considered not to be a pure monopoly as there are substitutes
that fulfil the same need – such as cars, motorbikes, buses, taxis and planes. So, consumers can
potentially replace train travel with a different method.
 IRCTC has a monopoly in providing online ticket booking, packaged drinking water and catering
services to Indian Railways passengers.
 Price maker
 Price discrimination
 Senior citizen
 Students
 Army officials etc