Bus operators in Bangladesh are losing Tk 500 crore every day as they have been off the road because of the lockdown, which may turn many owners into loan defaulters as their income has fallen to zero.
According to the Bangladesh Road Transport Owner Association (BRTOA), around 80,000 buses, including aired-conditioned (AC), non-AC, and minibus, ply different routes.
The Bangladesh Road Transport Authority puts the number at 75,348.
"We don't have any alternative but to follow the government directive to ensure public health safety even though we are incurring losses," said Moshiur Rahman Ranga, president of the BRTOA.
He fears the owners of buses may turn into loan defaulters as they will not be able to make timely payment of instalments.
The passenger bus segment did not avail financing under the stimulus package despite giving essential service to the public, he said.
"We would like to request the prime minister to arrange relief for the transport workers," he added.
In his view, the owners owe around Tk 10,000 crore to banks in loans, which have been secured against the vehicles. "It is tough to repay the bank loans under these circumstances."
Bangladesh Bank data showed Tk 33,800 crore in loans were disbursed in the different segments of the transport sector in the last fiscal year. Tk 17,100 crore was lent during the July to December period of the current fiscal year.
"According to our estimate, bus service operators face a revenue loss of around Tk 500 crore per day due to the lockdown," said Khondaker Enayet Ullah, secretary-general of the BRTOA.
"This loss is a severe challenge for investors. If we can't operate buses, how will we pay the interest of bank loans and the wages to the drivers and helpers?"
The leader said they had demanded exemption on the interest of bank loans several times to survive the business. "But we have not received any cooperation under the stimulus package announced by the government."
He said there were around 30,000 bus owners, and everybody had bank loans against their vehicles.
"It is a challenging time for the investors in this sector," he said.
According to the BRTOA, around Tk 22,600 crore has been invested in the bus segment, which has created around 15 lakh jobs, directly and indirectly.
Mohammed Shahidul Islam, chairman of HNS Group, which operates a bus service, has Tk 30 crore bank loans and is facing troubles in repaying loan instalments every month.
"I have been facing difficulties to stay afloat since the beginning of the pandemic in March last year."
Throughout the pandemic, the number of passengers was lower compared to regular times, and it was tough to recover the operational cost and earn enough to pay the bank instalment, he said.
The bus service segment incurred a revenue loss of at least Tk 33,000 crore during the pandemic-induced 66-day lockdown last year, Islam said.
"The sector is providing services to the people, so the government should give incentive for the welfare of the people," he said, adding that the passenger bus service segment contributes around 3 per cent to the gross domestic product.
Abdus Sattar, general manager of Green Line Paribahan, said the engine of the buses gets damaged if they do not operate.
He has Tk 70 crore in loans.
The central bank has deferred the instalment payment for three months, giving slight relief to the borrowers, he admitted, however.
Green Line has 150 buses that operate in various routes of the country and employs 1,200 people.
Monzur Hossain, research director of the Bangladesh Institute of Development Studies, said there was a possibility that the borrowers might become loan defaulters due to the lockdown as their income has fallen to zero.
Considering the situation, the central bank should extend the loan moratorium period for at least six months, he said.
Md Serazul Islam, a spokesperson of Bangladesh Bank, said the transport industry falls under the service sector, so they could borrow from banks under the stimulus package.
In March last year, the government unveiled a Tk 33,000 crore package for large industries and the service sector. In October, the volume of the package was enhanced by Tk 7,000 crore to Tk 40,000 crore.
All sectors are eligible to avail of the benefit under the stimulus package, the central banker said, adding that nobody would receive funds without meeting the criteria.