Photo: Truckers in Bhutan

Removal of driver switching system brings down transportation charges but price of commodities remain constant

With the cancellation of the driver switching modes on 28 March, the transportation charges have come down, as shared by many business entities. However, commodity prices have not fallen. Instead, the price of some commodities, such as vegetable oil, dalda, and so on, has increased.

A wholesaler in Babesa, Thimphu, Ugyen, said that while the government has removed the driver switching system, transportation charges have reduced by few thousands, but commodities prices have not decreased.

“I expect it will continue to increase rather than fall. The costs of goods are becoming costlier from the supplier itself,” he said.

Owner of Dokar wholesale grocery shop near the Centenary Farmers’ Market, Kinley Gyem, said that though the transportation charges was supposed to have reduced since the driver switching system was removed, the transportation charges remained the same owing to the increase in fuel prices.

“The price of goods has remained constant, while some products, such as cooking oil and dalda, have increased. The price of items is projected to rise shortly, with the majority of goods coming with a new pricing,” she said.

Meanwhile, a truck owner Tashi said that prior to the driver switching method; one truck required two drivers and two trucks required four drivers, resulting in very high transportation costs.

“Drivers from Phuentsholing to Sorchen demanded Nu 2,500, despite the fact that the route was short. Now that the system has been removed, the cost has decreased, but it has not returned to what was before owing to fuel price inflation,” he said.

Another truck owner Rigyel said that by removing the system, the cost of transportation has been dropped by a few thousands.

“We are relieved that this system has been discontinued because it was difficult for us to obtain a driver because they were demanding exorbitant charges. Despite the fact that fuel prices are high, transportation charges have decreased slightly, and we are still pleased since we do not have to change drivers and risk being charged a substantial sum,” he said.

According to the National Statistics Bureau, the prices of consumer goods and services in February 2022 increased by 5.32 percent from February 2021. Non-food prices continue to record higher increase with 6.37 percent compared to 4.10 percent increase for food group. Non-food increase accounted for 62 percent of the overall inflation rate while the remaining was contributed by food prices.

Transport recorded the highest price increase with 10.06 percent mainly associated with fuel price which increased by around 32 percent on average. It contributed to 27 percent of the total inflation rate in February 2022.

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