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Abstract
Transport industry plays a vital role in the development of economic of a nation. In fact, the progress of a nation and progress of its transport industry is complementary to each other. The Road Transport industry has a lions share in Indias
economic development. Due to easy accessibility, flexibility of operations, door to door service and reliability, Road
Transport in India showed an increase in share of both passenger and freight traffic vis--vis other modes of transport.
Transport sector accounts for 6.4% share in Indias Gross Domestic Product (GDP).However, Road Transport has
emerged as a dominant segment in Indias transportation sector with a share of 4.8% in Indias GDP comparison to railways that has a meager 1% share of GDP in 2011-12. With the help of this research paper the author has tried to examine
the revenue structure of Road Transport sector in India. Besides this the author has also focused on some suggestion for
improvement of revenue in Road Transport sector of India.
Keywords: Transport, Road Transport, Economy, Taxation, Revenue, Gross Domestic Product (GDP), Sustain
Introduction
With the economic development of infrastructure in India, the country has progressed at a rapid pace and today
there is an availability of wide variety of modes of
transport by land, water and air. But, overall Road
Transport is the primary and preferred mode of transport
for most of the population and Indias Road Transport
system is among the most heavily utilized system in the
world. It plays a pivotal role in the economic development of a nation by increasing the productivity and competitiveness. The Indian Central Government and the
State Governments after realising the importance of the
road networks in economic development have taken numerous initiatives to improve the national road network,
both in terms of upgrading the quality and augmenting
the magnitude to keep pace with the demands dictated by
the economic liberalization. The benefits and importance
of Road Transportation infrastructure to economic
growth have been recognized for a long time. A well
oiled transportation infrastructure expands the productive capacity of a nation, both by increasing the mobilization of available resources and by enhancing the
productivity of those resources. The support for this
statement is straightforward and there are many ways
through which we can justify it. Firstly, Road Transportation infrastructure can enter the production process as
direct input and in many cases as an unpaid factor of
production. Secondly, it may make other existing, inputs
more productive. For instance, a well designed road allows the transportation of goods to market in less time
and hence, reducing the transportation cost in the production process. Thirdly, Road Transportation increases
regional economic growth by attracting resources from
other regions. In this vein one would recall that throughout the growth of civilization, most centers of economic
activities flourished along riverbanks and coast lines
where water ways the convenient prime carrier of raw
materials goods and labour.
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Research Objectives:
The main objective of the present study is to examine the
revenue generated from Road Transport sector in India.
To attain this main objective, the following incidental
objectives are sought to be achieved:
a)
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e)
Research Methodology:
The study has been carried out for a span of the period
1950-51 to 2012-13. For this purpose, secondary data
has been used which is collected from various annual
transport year book published by Shipping, Road
Transport and Highways Ministry, Government of India.
The reason behind selecting this study period is the
availability of data. Due to unavailability of data in the
share of different modes of transport in GDP, the author
has taken a time span of 2001-02 to 2011-12. After the
collection of requisite data, these have been suitably rearranged, classified and tabulated as per requirements of
the study. For the explanation of given data the author
has used only simple statistics as average and percentage.
Sustained economic growth has brought about a remarkable development expansion in infrastructure of the
transport sector. From Table-1, the share of transport
sector in GDP of India has increased from 6.0% in 200102 to 6.5% in 2011-12. This table clearly shows that the
contribution of Road Transport sector in GDP is much
higher than other modes of transport. It has increased
from 3.9% in 2001-02 to 4.8% in 2011-12. While during
this period the contribution of railways in GDP has
shown a decrease from 1.2% in 2001-02 to 1.0% in
2011-12. The share of various sub-sector of the transport
sector in GDP since 2001-02 is given in table-1.
Table -1
Share Of Different Modes Of Transport In GDP
Year
200102
200203
200304
200405
200506
200607
200708
200809
200910
201011
201112
Sector
Transport
of
Which
Railways
Road Transport
Water
Transport
Air Transport
Services*
6.0
6.2
6.4
6.7
6.7
6.7
6.7
6.6
6.5
6.4
6.5
1.2
3.9
0.2
1.2
4.1
0.2
1.0
4.6
0.2
1.0
4.8
0.2
1.0
4.8
0.2
1.0
4.8
0.2
1.0
4.7
0.2
1.0
4.8
0.2
1.0
4.6
0.2
1.0
4.6
0.2
1.0
4.8
0.2
0.2
0.5
0.2
0.2
0.2
0.2
0.2
0.2
0.2
0.5
0.5
0.5
0.5
0.5
0.5
0.4
Source: www.morth.nic.in; (Transport Year Book 2011-12)
0.2
0.4
0.3
0.4
0.3
0.4
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Custom Duties
State Government
Levies
Excise Duties
Custom Duties
2.
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Excise Duties
3.
4.
19
Motor-Vehicle
and Fees
Amount
1950-51
N.A.
1960-61
1970-71
1980-81
1990-91
2000-01
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
29.9
107.7
356.3
1566.3
7644.0
11964.0
13630.0
15595.0
17340.0
19638.0
23498.0
28897.0
34173.7
% to
Total
0.0
Tax
Amount
% to total
Amount
12.5
99.2
0.1
12.6
54.2
16.9
30.6
8.4
15.2
55.2
46.5
63.2
27.3
60.5
26.2
231.4
47.5
154.5
20.6
239.6
31.9
750.4
48.1
631.5
19.4
1061.8
32.5
3259.6
45.1
5645.0
33.3
3671.4
21.6
16960.4
56.0
2951.0
13.8
6450.0
30.2
21365.0
62.6
1332.0
6.1
6808.0
31.7
21770.0
64.6
1623.0
6.8
6808.0
28.3
24026.0
50.6
8438.0
24.6
8463.0
24.8
34241.0
49.6
1008.0
25.3
9857.0
25.1
39573.0
51.1
11198.0
24.3
11296.0
24.6
45992.0
53.9
13017.0
24.3
11663.0
21.8
53577.0
53.0
15528.8
24.1
14725.0
22.9
64427.5
Source: www.morth.nic.in ;( Transport Year Book 2006-07 to 2011-12)
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%
to
Total
0.8
Total
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from motor sprit was the highest (39%) followed by motor vehicles & accessories (31%), high speed diesel oil
1950-51
1960-61
1970-71
1980-81
1990-91
2000-01
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
Total
%
to
total
0.8
26.2
23.4
35.1
33.5
35.4
39.6
58.3
47.2
44.8
39.6
34.8
111.7
451.8
930.9
4596.0
23861.0
49991.0
54580.0
56758.2
53098.0
48386.9
75453.2
75572.6
69411.5
(Rs. in Crore)
Central
State
Year
Total
Amount
1950-51
34.8
% to Total
73.4
1960-61
1970-71
1980-81
1990-91
2000-01
2005-06
2006-07
2007-08
2008-09
111.7
451.8
930.9
4596.0
23861.0
49991.0
54580.0
56758.2
53098.0
66.9
66.1
55.4
58.5
64.9
70.1
71.5
70.3
60.8
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Amount
12.6
% to Total
26.6
47.4
55.2
231.4
750.4
3259.6
12901.7
21365.0
21770.0
24026.0
34241.0
33.1
33.2
44.6
41.5
35.1
29.9
28.5
29.3
29.2
166.9
683.2
1681.3
7855.6
36762.7
71356.0
76350.0
80784.2
87339.0
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2009-10
2010-11
2011-12
2012-13
48386.9
55.0
39573.0
45.0
87959.9
75453.2
62.1
45992.0
37.9
121445.2
75572.6
58.5
53577.0
41.5
129149.6
69411.5
51.9
64427.5
48.1
133839.0
Source: www.morth.nic.in ;( Transport Year Book 2006-07 to 2011-12)
tonne kms.) carried by road grew at an annual average
rate of 6.5% compared with a growth of 3.6% in rail
freight. Over the years the model split in freight movement between rail and road has skewed in favour of
TRENDS IN RAIL ROAD MODES IN FREIGHT
road. The share of Road Transport in freight movement
AND PASSENGER TRAFFIC:
which was around 14% in 1950-51 has increased to
around 65% while that of railway has fallen from more
than four-fifth to less than two-fifth over the same period. Other side the share of Road Transport in passenger
Both freight and passenger movements by roads
movement which was around 15% in 1950-51 has inare rapidly increased during the study period. With the
creased to around 86% while that of railways has fallen
help of Table-5 the author has tried to make a relation
from around 85% to barely 14% over the same period.
between revenue and traffic movement (goods & pasOverall the data supports the finding of Table-1. The
sengers) of Rail and Road Transport.Table-5 clearly rerevenue generation through rail-road modes in freight
flects the trend in Rail: Road Transport modes in freight
and passenger traffic is directly responsible for their conand passenger traffic. Road Transport sector has seen
tribution in transport GDP of the nation. Therefore, the
higher growth vis--vis railways during 1950-51 to
share of transport GDP via Road Transport is higher than
20112. During this period the volume of freight (billion
other modes of transport.
Year
1950-51
1960-61
1970-71
1980-81
1990-91
1999-00
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
13.8
37.6
86.2
23.0
15.4
16.2
72.3
83.8
80.9
51.0
30.1
110.7
69.9
210.0
64.0
38.1
147.7
61.9
541.8
72.2
38.1
235.8
61.9
767.7
72.2
60.5
305.2
39.5
1831.6
81.0
59.9
441.8
40.1
4251.7
87.4
61.4
481.0
38.6
4545.8
86.7
62.0
521.3
38.0
4680.3
86.3
62.5
551.4
37.5
5196.5
86.1
62.8
600.5
37.2
5555.9
86.0
64.3
625.7
35.7
5940.3
85.9
64.5
667.6
35.5
6351.2
85.9
N.A.
N.A.
N.A.
N.A.
N.A.
Source: www.morth.nic.in ;( Transport Year Book 2006-07 to 2011-12)
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2.
66.5
77.7
118.1
208.6
295.6
430.7
615.6
694.8
770.0
838.0
903.4
978.5
1046.5
N.A.
84.6
49.0
36.0
27.8
27.8
19.0
12.6
13.3
13.7
13.9
14.0
14.1
14.1
N.A.
be taxed lightly vis--vis two axle trucks. The impact could be cushioned by according a concessional
excise duty structure for MAV and articulated vehicles.
With a focus on the road damage factor there is a
need to move vehicle taxation of goods vehicles in
particular from gross vehicle weight to axle loads.
The latter bears a close relation with road damage
and will also encourage use of MAV.
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3.
4.
5.
6.
7.
8.
Conclusion:
Tax imposition on vehicles in India is the subject matter
of both Central and State Governments. Taxation on
vehicles begins with the purchase and continues during
the use and shifting ownership of it. Major taxes levied
on vehicles include custom duty; central VAT and central sales tax are imposed by Central Government. Other
taxes including motor vehicle tax, passenger & goods
tax, State VAT and toll taxes are levied by the State
Governments.
The existing structure of road user taxes is characterized
by its multiplicity. It shows wide variations in tax rates.
First there are differing schemes for classification of
vehicles. Second, there is no uniformity in the bases of
various levies. Third, the tax is at the time specific while
in some cases it is ad-valorem levy payable every year in
fact. It is difficult to make comparison of rates levied on
different types of vehicles in different states.
The main findings are listed here:
1.
2.
3.
4.
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5.
6.
References:
[1] Ministry of Shipping, Road Transport and Highways
(MORTH), National Road Transport Policy, Department of Road Transport and Highways, Government of India, 2010.
[2] Ministry of Shipping, Road Transport and Highways
(MORTH), Transport Year Book (2006-07 to 201112). Department of Road Transport and Highways,
MORTH, Government of India.
[3] Ministry of Finance, Economic Survey 2013, Ministry of Finance, Government of India, 2013.
[4] A.C.Roy: Transport infrastructure in the SAARC
countries, survey, Vol. 35, pp 1-13, 1995.
[5] D.K.Halder and G. Gupta : Public Transport and
Urban land use in a developing economy; special
reference to Calcutta, International conference on
urban and regional change in developing countries,
IIT, Kharagpur, December, 1981.
[6] J.S. Mathur : Road accidents in India, Transport
and economic development (edited), Chug Publications Allahabad, pp.127-129, December 1992.
[7] A.H. Munnel: Infrastructure investment and economic growth, Journal of economic perspective
pp.189-198, December 1992.
[8] G. Raghuram and D. Kheskani: Governments role
in road tool collection the Coimbatore bypass experience,
India.
Available
from
http://202.41.76.252/publications/data/2002-097.
G. Raghuram pdf.
[9] The annuity road, The Hindu business line, pp.10,
January 02.
[10] H.S.Estaham and M.T.Ramirez: Instructions, infrastructure and economic growth, Journal of Development Economics, pp. 443-447, Mrch 2003.
[11] J.K.Jain: Transport economics, Chaitanya Publishing House, Allahabad, pp.239-241. April 1973.
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[12] D. Madhu Babu: Public Transport and Urban environment: The challenges Indian journal of
Transport Management, pp.89, Feb.1999
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