Growth Performance of State Transport Undertakings in India C.Senbaga Aiyan Moorthi* Dr.S.Ganesan** * Ph.D. Scholar, Department of Economics, Bharathidasan University, Tiruchirappalli. ** Asst. Professor, Department of Economics, Bharathidasan University, Tiruchirappalli. Abstract An efficient and well developed system of transport is vital to the success of economic development. Among the various modes of transport, road transport plays a very important role in economic development. Further, road transport provide one of the basic infrastructure for economic development of backward areas and serve as a feeder service to rail traffic, ports and harbours and airports. The growth of fleet strength, volume of operation, fleet utilization, vehicle productivity, passengers carried daily, personnel cost of the Road Transport Corporations and total cost in India computed by using the following exponential functional form for the period 2000-01 to 2015-16. From the overall analysis, all indicators have showed better growth performance during the period under review. Among the 14 STUs, it is found that the performance of Tamil Nadu State Transport Corporation (TNSTC) has grown drastically in the study period and it hold better potential for future than other State Transport Undertakings in India. Key words: State Transport Undertaking, Fleet Utilization, Vehicle Productivity, Fuel performance , Manpower Productivity, Accident, Breakdown, Total Cost, Total Revenue. Introduction The Nation’s transportation system is a major component of the national economy and an important factor in shaping out people’s life style, community development and industry location patterns. The transport services are provided by roadways, air ways, railways and waterways. The International journal of analytical and experimental modal analysis Volume XI, Issue IX, September/2019 ISSN NO: 0886-9367 Page No:2683
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Growth Performance of State Transport Undertakings in India
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Growth Performance of State Transport Undertakings in
India
C.Senbaga Aiyan Moorthi* Dr.S.Ganesan**
* Ph.D. Scholar, Department of Economics, Bharathidasan University, Tiruchirappalli.
** Asst. Professor, Department of Economics, Bharathidasan University, Tiruchirappalli.
Abstract
An efficient and well developed system of transport is vital to the success of
economic development. Among the various modes of transport, road transport plays a
very important role in economic development. Further, road transport provide one of
the basic infrastructure for economic development of backward areas and serve as a
feeder service to rail traffic, ports and harbours and airports. The growth of fleet
strength, volume of operation, fleet utilization, vehicle productivity, passengers carried
daily, personnel cost of the Road Transport Corporations and total cost in India
computed by using the following exponential functional form for the period 2000-01 to
2015-16. From the overall analysis, all indicators have showed better growth
performance during the period under review. Among the 14 STUs, it is found that the
performance of Tamil Nadu State Transport Corporation (TNSTC) has grown
drastically in the study period and it hold better potential for future than other State
Transport Undertakings in India.
Key words: State Transport Undertaking, Fleet Utilization, Vehicle Productivity,
Fuel performance , Manpower Productivity, Accident, Breakdown, Total
Cost, Total Revenue.
Introduction
The Nation’s transportation system is a major component of the national
economy and an important factor in shaping out people’s life style, community
development and industry location patterns. The transport services are provided by
roadways, air ways, railways and waterways.
The International journal of analytical and experimental modal analysis
Volume XI, Issue IX, September/2019
ISSN NO: 0886-9367
Page No:2683
Among these services, road transport plays a very important role in economic
development of the country particularly backward areas also. Due to lot of increase in
population, bus system in all areas becomes a dominant transport mode for all people.
Since 1950, Government has provided public transport corporations through different
acts. In India lots of state transport undertakings cater to the needs of people. In order to
arrive at an appropriative investment policy on the part of the Government, it is
essential to have a closer watch on the Performance of State Transport Undertakings
(STUs) regularly. In this context, performance of STUs assumes its significance and the
present study are proposed to assess the performance of STU in Tamil Nadu.
Data Source and Methodology
The study covers for the period from 2000-01 to 2015-16. The data pertaining to
all states have been collected. There are 14 states have been covered for the purpose of
analysis. The study is based on the secondary data published by annual reports of CIRT
Pune, Tamil Nadu State Road Transport Corporation. The Ministry of Surface
Transport, Government of India, Ministry of Transport in Tamil Nadu, Chennai,
Transport Commissioner, Chennai, Institute of Road Transport and Secretary of
Commerce and Industries, Chennai. To examine the objective of the growth
performance compound growth rate has been used.
Growth Model
The growth of fleet strength, volume of operation, fleet utilization, vehicle
productivity, passengers carried daily, personnel cost of the Road Transport
Corporations and total cost in India computed by using the following exponential
functional form for the period 2000-01 to 2015-16.
Growth is studied with reference to annual growth rates computed based on the
compound interest rate formula adopted by the World Bank using the least square
methods.
The International journal of analytical and experimental modal analysis
Volume XI, Issue IX, September/2019
ISSN NO: 0886-9367
Page No:2684
The least squares growth rate ‘r’ is estimated by fitting a least squares linear
regression trend line to the logarithmic annual values of the variable in the relevant
period. More specifically, the regression equation takes the form
Log Xt = a + bt +et
Where this is the equivalent to the logarithmic transformation of the compound
growth rate equation
Xt =X0 (1+r) t
In these equations ‘X’ is the variable, ‘t’ is time period and a=log X0 and b=
log(1+r) are the parameters to be estimated, ‘e’ is the error term. If b* is the least
squares estimates of ‘b’ then the average annual percentage growth rate ‘r’ is obtained
as (antilog b* ) –1 and multiplied by 100 to express it as percentage.
Results and Discussion
Fleet Strength
Vehicles used for earning revenue or which cover effective kms are alone to be
treated as vehicles on road. The number of vehicles on road is equal to the number or
regular schedules operated plus the number of additional vehicle used exclusively for
operations of extra and casual contracts. A vehicle already used for a schedule is
included in the figure of vehicle on road.
The International journal of analytical and experimental modal analysis
Volume XI, Issue IX, September/2019
ISSN NO: 0886-9367
Page No:2685
Table-1 presents the details about the average number of buses on road (Fleet Strength)
in India from the period 2000-01 to 2015-16. In the initial period (2000-01) when the
fleet strength of all the STUs in India are compared, it is found that the APSRTC had
the largest fleet strength (18764 buses) followed by MSRTC (15920 buses) and TNSTC
(15377 buses). The OSRTC had the least fleet strength i.e., 254 buses. At the end of the
study period TNSTC had the largest fleet strength of 18501 buses followed by MSRTC
(16981 buses) and APSRTC (11931 buses). In the mean value of fleet strength of all
STUs in India, the APSRTC has the largest fleet strength of 18996 buses followed by
TNSTC (16886 buses) and MSRTC (15541 buses) while OSRTC has the lowest fleet
strength with 271 buses. In the case of all India fleet strength, in the initial period it was
1,04,629 buses and it was 1,25,412 buses in the final period of time showing with an
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Volume XI, Issue IX, September/2019
ISSN NO: 0886-9367
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average fleet strength of 1,10,500 buses over the years. All the STUs in India recorded
positive growth rates except GSRTC (-1.57 percent), APSRTC (-1.21percent) and
RSTC (-0.51 percent). Fifty percent of the STUs have achieved higher growth rate than
India (1.43 percent). The NEKnRTC has recorded that highest growth rate of 5.27
percent and followed by KSRTC (4.38 percent). It is evident from the analysis that the
STUs were functioning well during the study period.
Volume of Operation
Kilometers covered per vehicle on road per day. It is a measure of efficiency of
both the Engineering and Traffic Departments. It indicates to what extent the vehicles
available for operations. Usually vehicle utilization is expressed in relation to gross
kilometers.
The International journal of analytical and experimental modal analysis
Volume XI, Issue IX, September/2019
ISSN NO: 0886-9367
Page No:2687
Table-2 indicates the effective kilometers of all STUs in India from the period
2000-01 to 2015-16. From the beginning of the study period TNSTC had the maximum
of effective kilometers (2290 kms) followed by APSRTC (21781 kms) and MSRTC
(17944 kms). The KDC had minimum effective kilometers i.e., 273.88 kms followed
by OSRTC (281.94 kms) and SBSTC (335.59 kms). At the end of the study period
TNSTC had the highest effective kilometers of 31509 kms followed by MSRTC
(21006.4 kms) and APSRTC (16237.6 kms). In the mean value of effective kilometers
of all STUs in India, the TNSTC has achieved the highest effective kilometers of 27181
kms and followed by ASRTC (22691kms). In all India effective kilometers it was
1,19,669 kms in the initial period and in the final period of time it was 1,57,514 kms
with an average effective kilometers of 1,36,386 kms. All STUs have taken effective
policies and good maintenance during the study period. All the STUs in India recorded
positive growth rates except GSRTC (-0.2 percent). Fourty percent of the STUs have
achieved higher growth rate than India (2.09 percent). The NEKnRTC has recorded that
highest growth rate of 5.80 percent and followed by KnSRTC (4.48 percent). It is
evident from the analysis that the STUs were functioning well during the study period.
Fleet Utilization
Fleet utilization also termed as vehicular utilization is the ratio of the number of
vehicles on road to the fleet held by the unit. Fleet utilization is always expressed as
percentage and it is a measure of productivity of the Engineering Department. It
indicates how many of the total vehicles are actually utilized for operations. Fleet
utilization can also be calculated on the basis of the effective fleet, that is to say, the
total fleet held minus vehicles held up for major repairs, scrapping, etc.
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The highest fleet utilization reveals the optimum utilization of capital employed. Fleet
utilization is the ratio between the total fleet strength and number of fleet put for use.
Table-3 shows that highest utilization of fleet in the year of 2000-01 i.e. 99 percent by
APSRTC and 98.4 percent in KnSRTC, 96.8 percent both in STHRA and NEKnRTC.
The SBSTC had the lowest fleet utilization of 63.6 percent followed by KDTC (76.6
percent) and GSRTC (87.1 percent). At the end of the study period UPSRTC had the
highest fleet utilization percent of 96.8 followed by NWKnRTC (96.2 percent) and
APSRTC (92.8 percent). The mean value of fleet utilization of all STUs in India, the
APSRTC has the largest fleet utilization (98.13 percent) followed by UPSRTC (95.21
percent) and NWKnRTC (94.49 percent). In the case of all India fleet utilization, in the
initial period it was 90.8 percent but at the final period of time it was 88.6 percent with
an average fleet utilization of 91 percent. All the STUs in India recorded negative
growth rates except SBSTC (0.68 per cent), KSRTC (0.48 per cent) and UPSRTC (0.46
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ISSN NO: 0886-9367
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percent) during the study period. It is estimated that 80 percentage of capital employed
by STUs has been invested in fleets. It is evident from the analysis that the utilization
of capital was poor in the study period.
Vehicle Productivity
Vehicle Productivity refers to the average kilometers run by each bus per day in
a year. The vehicle productivity is also termed as vehicle utilization or vehicle
efficiency. The average number of revenue earning kilometers performed by a bus per
day is expressed in terms of vehicle productivity per bus per day. As a result, the
effective use of such STUs is assessed and considered as a prime concern to evaluate
the performance of such STUs.
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Volume XI, Issue IX, September/2019
ISSN NO: 0886-9367
Page No:2690
The detail of vehicle productivity is shown in the Table-4. The vehicle
productivity as a whole in India was 313.4 kms/day in the year 2000-01 and it was
increased to 344 kms/day in 2015-16 with the average vehicle productivity of 337.39
kms /day during the study period. It has recorded growth rate of 0.65 percent. Among
the 14 STUs, TNSTC has achieved vehicle productivity at the highest level of 408.1
kms /day in the year 2000-01 and it has increased to 467 kms/day in 2015-16. TNSTC
has dominated in vehicle productivity with the mean value of 439.85 kms/day
throughout the study period and recorded the positive growth rate of 0.81 percent. In
2000-01, some of the STUs such as KDTC (263.3 kms/day), UPSRTC (269.8