PERFORMANCE IMPROVEMENT MEASURES FOR SIKKIM …...Sikkim is the least populous state in the country with only 540,851 inhabitants as per 2001 Census growing by 33.06% during 1991-2001

Consultancy study on Performance Improvement measures for SNT ________________________________________________________________________

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PERFORMANCE IMPROVEMENT MEASURES FOR SIKKIM NATIONALISED TRANSPORT

Draft Report

December 2008


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STUDY FOR PERFORMANCE IMPROVEMENT MEASURES FOR SIKKIM NATIONALISED TRANSPORT

INDEX

Page Nos. List of Chapters 1. Introduction ..........1-1 to 1-3 2. Appreciation of the Study Area 2-1 to 2-5

3. Relevance of SNT ..........3-1 to 3-10 4. Passenger Transport Services in SNT 4-1 to 4-10 5. Freight Operations in SNT ..........5-1 to 5-17 6. Infrastructure Development ..........6-1 to 6-5 7. Fleet Replacement and Augmentation 7-1 to 7-10 8. Maintenance Management ..........8-1 to 8-16 List of Tables List of figures List of Annexures


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List of Tables

Sl.No. Table No. Topic

Page No.

1 2.1 Vehicle population in Sikkim 2-3

2 2.2 Year-wise vehicle Registration in Sikkim 2-4

3 3.1 Operations of SNT 3-1

4 3.2 Registered vehicles of SNT 3-2

5 3.3 Profit/Loss statement of SNT 3-3

6 3.4 Depot-wise earnings of passenger services 3-4

7 3.5 EPKM from passenger services 3-4

8 3.6 Fleet strength of truck and tankers 3-7

9 3.7 Category of employees at SNT 3-7

10 5.1 Truck movement in Sikkim 5-3

11 5.2 Tanker movement in Sikkim 5-4

12 5.3 Origin-destination (goods-wise) 5-5 to 5-6

13 5.4 Fleet position according to age of the vehicles 5-7

14 5.5 Age-wise performance of truck in the year 2007-08

5-8

15 5.6 Major freight corridors 5-8

16 5.7 Major freight corridors 5-9

17 5.8 Major destinations served by SNT 5-10

18 7.1 Scrapping policy in Similar STUs 7-1

19 7.2 Age-wise classification of vehicles 7-2

20 7.3 Vehicles to be scrapped as per accepted policy 7-3

21 7.4 Vehicles to be replaced 7-4

22 7.5 Year-wise Gross Domestic Product in Sikkim 7-4

23 7.6 Fleet position in the Horizon year 7-5

24 7.7 Additional requirement of fleet in horizon year 7-6

25 7.8 Total requirement of fleet in the horizon year 7-7

26 7.9 Financial requirement of buses 7-7

27 7.10 Financial requirement for trucks and tankers

7-8

28 7.11 Total financial requirement for all vehicles 7-8

29 8.1 Norms for manpower planning 8-5

List of Figures

Sl.No. Fig. No. Topic

Page No.

1 3.1 Fleet utilization 3-5

2 3.2 Vehicle utilization for SNT 3-6

3 3.3 Fuel efficiency 3-6

4 4.2 Siliguri terminus – Need for upgradation 4-2


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Sl.No. Fig. No. Topic

Page No.

5 5.1 Material-wise no. of consignments carried by private trucks

5-5

List of Annexures

Sl.No. Annexure No. Topic

Page No.

1 4.1 Breakeven load factor and fare for buses 4-8 to 4-9

2 4.2 Fare per passenger km. 4-10

3 5.1 Percentage share of freight trips between origin-destination for private trucks

5-14

4 5.2 Percentage share of freight trips between origin-destination for SNT vehicles and vehicles hired by SNT

5-15

5 5.3 Fare revision model for trucks 5-16 to 5-17

6 7.1 List of all vehicles considered in the analysis 7-9 to 7-10

7 8.1 Plant and equipment requirement at Gangtok and Jorethang

8-8 to 8-9

8 8.2 Preventive maintenance schedules -Daily 8-10

9 8.3 Preventive maintenance schedules -Monthly 8-11

10 8.4 Preventive maintenance schedules - Quarterly (3 months)

8-12 to 8-13

11 8.5 Preventive maintenance schedules for 18,000 kms., 36,000 kms. And 72,000 kms.

8-14 to 8-16


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Chapter 1

INTRODUCTION

1.1 Background

The transport operations by the Government of Sikkim were started in 1944 through the setting

up of a truck department with limited operational capability. In the year 1951-52 an

arrangement was made with organizations of then neighbouring country India to open railway

out agency in Rangpo and Gangtok. Freight services were expanded to Siliguri subsequently.

Since its inception the transport services in Sikkim have been provided by this organization which

was subsequently renamed as Sikkim Nationalised Transport. The organization grew steadily

over a period of time and had 148 buses and 189 truck/tankers under its operation. However,

after 1994 the organization has shown a steady decline and the present fleet has reduced to 75

buses and 83 tankers. As a result of this decline, other modes of passenger transport have grown

in the state accounting for the majority of the market share. The support from the State

Government has also been limited in the past and SNT was unable to replace or augment its fleet

on time to improve the quality of its services. However, the importance of the role of the State

Government in providing passenger and freight services as a social obligation cannot be

overlooked. In this context, SNT has approached CIRT to study the present working of Sikkim

Nationalised Transport and suggest measures to improve productivity of the organisation.

1.2 Terms of reference

The study parameters and objectives are as follows:

What should be the increase in percentage per km. hike in respect of passenger ticket

and freight charges (per km. or per km. per tonne) in the event of hike in price of HSD.

Measures to be adopted for optimal utilization of existing fleet and manpower.

Measures to be adopted for plugging the leakage in revenue.

Measures to be adopted to reduce turn around time for freight operation.

Ways and means to be adopted for route rationalization.

Measured to be adopted to face competition from private operators both in the case of

passenger and freight vehicles, as also turn it to SNT’s advantage.

Recommendations for improving bus staff ratio, staff productivity, load factor, fleet

utilization, fuel efficiency etc.

Measures to be adopted for optimal utilization of workshop facilities.


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Study/recommendation for private sector participation.

1.3 Methodology

The study team visited various bus stations and workshops of SNT during its visits to Sikkim.

Detailed discussions were held with the officers of SNT, both at the headquarter level and the

field level to solicit their views on the measures to be undertaken to improve the performance of

SNT. Primary data was collected from the checkposts of SNT to assess the movement of goods in

the state. The secondary data provided by SNT was analysed to review the present status of

operations in the organization.

1.4 Chapter scheme

Chapter 1 - Introduction

Chapter 2 - Appreciation of the study area

Chapter 3 - Relevance of Sikkim Nationalised Transport

Chapter 4 - Passenger Transport Services in SNT

Chapter 5 - Freight operations in SNT

Chapter 6 - Infrastructure Development

Chapter 7 - Fleet Replacement and Augmentation

Chapter 8 - Maintenance Management


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Chapter 2

APPRECIATION OF THE STUDY AREA

2.1 Introduction

Sikkim is a landlocked Indian state nestled in the Himalayas. It is the least populous state in India

and the second smallest in area next to Goa. It spreads over an area of 7,096 sq kms. The thumb

shaped state borders Nepal in the West, Tibet to the North and East, Indian state of West Bengal

in the south and Bhutan in the southeast. The state is very crucial because if its strategic location

in the northeast region of the country. Despite its tiny size, Sikkim is geographically diverse,

owing to its location in the Himalayas.

The climate in the state ranges from subtropical to high alpine enjoying five seasons.

Kanchenjunga, the world’s third highest peak, is located in the northwestern part of the state on

the boundary of Nepal and can be seen from most parts of the state. Sikkim’s economy is largely

agrarian, based on traditional farming methods, on terraced slopes. However, due to the lack of

reliable transportation infrastructure because of the hilly terrain, there are no large-scale

industries. With a general improvement in the infrastructure, tourism is slated to be the

mainstay of Sikkim’s economy. Gangtok, the state capital is the largest town.

Sikkim has four districts – North, South, East and West with Mangan, Namchi, Gangtok and

Gyalshing as their headquarters respectively. Other important towns in the state include

Jorethang, Singtam, Rangpo, Pakyong, Rhenock, Melli, Chungthang and Soreng. Each district is

overseen by the district collector, who is in-charge of the administration of the civilian areas of

the district. The Indian Army has control of large territory, as the state is a sensitive border. Many

areas are restricted and permits are required to visit them. There are a total of eight towns and

nine sub-divisions in the state.

2.2 Demographic Characteristics

Sikkim is the least populous state in the country with only 540,851 inhabitants as per 2001

Census growing by 33.06% during 1991-2001. It is also the least densely populated state with

only 76 persons per square kilometer. Gangtok is the state’s only significant town with over

50,000 inhabitants as per the 2001 census. The urban population of Sikkim is around 11.06%. The

per capita income of Sikkim standing at Rs. 11,356 is the highest in the country.


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2.3 Transport Network

Sikkim does not have any airports or railheads because of its rough terrain. The closest airport,

Bagdogra Airport, is near the town of Siliguri, West Bengal. The airport is about 124 km away

from Gangtok. A regular helicopter service run by the Sikkim Helicopter Service connects

Gangtok to Bagdogra; the flight is thirty minutes long, operates only once a day, and can carry 5

people. The Gangtok helipad is the only civilian helipad in the state. The closest railway station is

New Jalpaiguri which is situated sixteen kilometres from Siliguri.

National Highway 31A links Siliguri to Gangtok. The highway is an all-weather

metalled road which mostly runs parallel to the river Teesta, entering Sikkim at

Rangpo. Numerous public and privately run bus and maxi-cab services connect

the airport, railway station, and Siliguri to Gangtok. A branch of the highway

from Melli connects western and southern Sikkim. Towns in southern and

western Sikkim are connected to the northern West Bengal hill stations of

Kalimpong and Darjeeling. Within the state, four wheel drives are the most

popular means of transport, as they can navigate rocky slopes. Maxicabs

operating on a shared basis are the most prevalent mode of transport in the

state.

All the transportation of goods and passengers of the State is through road. The

state is land locked and bound by foreign countries except in the South where it

is bordered by Darjeeling District of West Bengal. Unlike in other states there is

no Railways or Airways to share the responsibility of transportation of goods and

passengers. Therefore, the road network is the primary infrastructure for the

socio-economic development of the State and movement of commodities. The

terrain of the State and the climatic condition render the road network

vulnerable to perpetual landslides at one point or other. There are also, due to

same reasons, a number of streams and rivulets crossing the road necessitating a

large number of crossover bridges, culverts etc. The result is high cost of

construction and maintenance.

http://en.wikipedia.org/wiki/Bagdogra_Airport

http://en.wikipedia.org/wiki/Siliguri

http://en.wikipedia.org/wiki/West_Bengal

http://en.wikipedia.org/wiki/Helicopter

http://en.wikipedia.org/wiki/Helipad

http://en.wikipedia.org/wiki/New_Jalpaiguri

http://en.wikipedia.org/wiki/Kilometre

http://en.wikipedia.org/wiki/River_Teesta

http://en.wikipedia.org/wiki/Rangpo

http://en.wikipedia.org/wiki/Melli

http://en.wikipedia.org/wiki/Hill_station

http://en.wikipedia.org/wiki/Kalimpong

http://en.wikipedia.org/wiki/Darjeeling

http://en.wikipedia.org/wiki/Four_wheel_drive


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2.4 Vehicular population in Sikkim

The vehicle population in the state of Sikkim is about 34596 vehicles including passenger and

freight vehicles. The category wise vehicle population existing in the state is shown in table 2.1

below. It is observed that about 47% of the vehicle population in the state is consisting of private

cars and 17% are two wheelers. The bus based public transport system is on the decline and has

been largely replaced by a transport system comprising of maxicabs.

Table 2.1 : Vehicle Population in Sikkim

Category Vehicle Population

Two wheelers 5982

Private Cars 16328

Trucks 3750

Buses & Maxi Cabs 8459

Trailers & Tractors 77

Source: Sikkim Transport Department

The year wise vehicle registrations in the state in the last five years are shown in table 2.2. During

the period 2003-05, SNT fleet of buses has shown a decrease by nearly 25% from 100 in 2003-04

to 75 in 2007-08 inspite of increase in passenger demand. The trend in the table below also

shows that during the same period the number of taxis increased considerably. Since 2005, the

taxi registrations seem to be on the decrease, which could possibly be due to large number of

taxis already existing in the market and operation and sustenance gets difficult for new taxi

operators. Due to the rise in economy and urbanization the registration of private vehicles is

always expected to increase in any state with Sikkim being no exception.

Apart from the above observations it is understood that there are about 153 West Bengal taxis,

which have permits to ply in Sikkim.

Table 2.2: Year Wise Vehicle Registrations in Sikkim

Year 2W Trucks & Tankers Private Cars Govt. cars Taxis

2003-04 341 150 876 125 1009

2004-05 239 142 870 147 679

2005-06 287 250 943 134 589

2006-07 269 362 953 130 280

2007-08 223 260 663 138 246

Source: Sikkim Transport Department


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2.5 Conclusions

It is revealed from ground realities that provision of public transport and movement of essential

commodities in Sikkim remains a responsibility of the State Government owing to the

topography and wide dispersion of population pockets. Being a border state, provision of these

services for the defence forces also remain a priority for the Government. Owing to the seasonal

fluctuations in demand and low occupancy in public transport, market forces have led to a large

growth in transport vehicles like maxicabs. It is evident that only a small market share remains

with SNT which caters mainly to the demands of the army and other Government departments

apart from providing school buses for children.


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Chapter 3

RELEVANCE OF SNT

3.1 Introduction

Through its operation of fleet of commercial vehicles, SNT has been providing basic

transportation infrastructure since its inception. SNT is basically responsible to provide public

transport service to the people of Sikkim. Interestingly, the entire bus passenger transport in the

state is nationalized and no private bus operators are seen.

3.2 Review of passenger and freight operation in SNT

Currently, SNT has a fleet of 75 buses and 83 trucks/tankers. SNT operates throughout the state

on major arterial roads viz. NH-31 Gangtok to Siliguri, Gangtok to Mangan, Gangtok to Jorethang

and Gangtok to Rongli towards east. Total manpower in SNT is about 900 people. SNT operates

with 35 bus routes throughout the state. The city bus service of SNT runs from 7 a.m. to 6 pm in

the evening. SNT has about 10 buses attached purely for catering of school trips. There are 3

depots at Gangtok, Jorethang and Rangpo. The details of SNT operations are shown in the

following Table 3.1 below.

Table 3.1: Operations of SNT

Sl. No.

Depot Bus Operations Fleet Size

Routes Schedule Services

Distance Bus Trucks Tankers

1 Gangtok 17 21 1347 36 1 Rec Van

-

2 Rangpo 2 3 21 9 49 33

3 Rhenock 1 1 111 - - -

4 Jorethang 20 24 1189 30 1 -

Total 40 49 2668 75 51 33 Source: Sikkim Nationalised Transport

3.3 Fleet Strength

The share of public transport system on Indian roads is declining with Sikkim being no exception.

The operation of the public transport system being provided by Sikkim Nationalised Transport is

currently on a decline with reduction in the size of its fleet over the past years. Total number of

buses with SNT was 75 as on 31st

March 2008. The yearly registered fleet size of SNT during 1993


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- 2008 with respect to Buses, Trucks/Tankers is shown in Table 3.2. During the last decade, the

bus fleet has declined by 48.28% and the truck/tanker fleet has reduced by 45.75%. It is observed

that post 1998; the fleet size of SNT has reduced considerably.

Table 3.2: Registered Vehicles of SNT

Sl. No. Year Bus Truck/Tanker

Number % Increase Number % Increase

1 1992-93 148 - 189 -

2 1993-94 150 1.35 183 -3.17

3 1994-95 153 2.00 183 0.00

4 1995-96 157 2.61 169 -7.65

5 1996-97 154 -1.91 157 -7.10

6 1997-98 155 0.65 150 -4.46

7 1998-99 145 -6.45 153 2.00

8 1999-00 137 -5.52 140 -8.50

9 2000-01 124 -9.49 127 -9.29

10 2001-02 109 -12.10 118 -7.09

11 2002-03 106 -2.75 106 -10.17

12 2003-04 100 -5.66 92 -13.21

13 2004-05 86 -14.00 84 -8.70

14 2005-06 85 -1.16 90 7.14

15 2006-07 84 -1.18 93 3.33

16 2007-08 75 -10.71 83 -10.75

Source: Sikkim Nationalised Transport

3.4 Financial Performance

According to the data provided by SNT, it is observed that during the last financial year, SNT

could recover overall costs up to 82.91% leaving 18% of the total cost uncovered resulting in a

net loss of Rs. 2.68 crores. It is alarming to note that 52% of the total revenue goes on personnel

cost. The profit/loss statement of SNT for the past six years is shown in Table 3.3. From the table

3.3, it is seen that SNT had to bear a loss to the tune of Rs. 5.35 crores in 2004-05. It can be noted

that during this period the bus fleet has been reduced considerably by around 14% from 100 to

86. It is observed that around 52% of the revenue is generated out of traffic operations while

48% is earned as non-traffic revenue consisting mainly of supervision charges levied on trucks at

Rangpo and Melli.

Table 3.3: Profit/Loss Statement of SNT


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Sl. No.

Year Cost in Crores

(Rs.) Revenue in Crores

(Rs.)

Profit in Crores (Rs.)

1 2002-03 22.30 17.33 -4.97

2 2003-04 21.49 17.29 -4.20

3 2004-05 27.53 22.18 -5.35

4 2005-06 18.01 13.65 -4.36

5 2006-07 16.30 14.86 -1.44

6 2007-08 15.68 13.00 -2.68


3.5 Revenue from Passenger Services

Depot-wise earnings from passenger services during April 2006 to March 2007 are given below in

Table 3.4. It can be noted that around 97% of the total revenue is earned by Gangtok and

Jorethang depots. It is understandable since the majority of the bus schedules are operated by

these two depots. Gangtok is also the major urban centre in Sikkim and the State Capital

requiring regular services to be operated for the floating population, count attendees and

tourists. Jorethang is also an important centre in southern and western Sikkim which would

develop as a transport hub for those districts in the future.

Table 3.4 : Depot wise Earnings of passenger services

Depot Gangtok Jorethang Rangpo Rhenock

April 2007 1211981 524666 39015 42706

May 2007 1560005 534324 38730 61100

June 2007 1282747 465722 24230 53933

July 2007 1095217 363382 45750 35650

August 2007 879829 326967 48473 14915

September 2007 980648 339821 50810 16040

October 2007 1484769 574343 47355 7153

November 2007 1312093 404410 47810 9384

December 2007 1165716 392667 7370 -

January 2008 1008921 382290 3720 -

February 2008 1001908 362046 5920 -

March 2008 1142751 514021 41715 -

Total 14126585 5184659 400898 240881

3.6 Operational Performance

Earning per Kilometer from Passenger Services

The month-wise details of EPKM for the year 2006-07 obtained from the four depots of SNT are

shown in Table 3.5. The average EPKM of SNT passenger operations is 13.71. Rangpo depot has

the highest EPKM followed by Gangtok, Jorethang and Rhenock. Rangpo depot has an average

EPKM of 21.37 and the highest EPK was observed during October 2006 (31.82). It may be noted


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that Rangpo and Rhenock have limited bus operation and do not contribute significantly to the

overall performance of SNT.

Table 3.5: EPKM from Passenger Services

Sl. No. Month Gangtok Jorethang Rangpo Rhenock

1 April 2006 14.32 10.94 28.79 7.91

2 May 2006 15.87 10.53 25.62 8.07

3 June 2006 15.29 10.08 30.59 6.4

4 July 2006 19.46 8.12 23.25 6.78

5 August 2006 12.74 8.6 19.9 7.06

6 September 2006 13.01 8.68 24.06 7.41

7 October 2006 16.41 12.6 31.82 4.58

8 November 2006 14.41 9.07 18.11 5.52

9 December 2006 15.05 9.62 10.37 -

10 January 2007 12.78 9.29 8.02 -

11 February 2007 12.63 9.53 22.17 -

12 March 2007 13.23 10.94 13.7 - Average 14.60 9.83 21.37 6.72


3.7 Fleet Utilisation (%)

Fleet Utilization is the percentage of buses put on road to the number of buses held. The overall

fleet utilization of buses was 68% during 2007-08. This is equivalent to the national average

under hilly operations. This has more or less remained the same since 2004-05. It was observed

that during 2005-06, fleet utilization has reduced to 58% and then increased to 68%. The

following figure 3.1 shows year wise fleet utilization from 2004-05 to 2007-08.

Figure 3.1: Fleet Utilisation

Fleet Utilisation

50

55

60

65

70

2004-05 2005-06 2006-07 2007-08

Year

Fle

et

Uti

lisati

on

(%)

Bus


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3.8 Vehicle Utilization

The vehicle utilization of SNT buses for the year 2007-08 is 109. The trend for the last four years

for V.U has been shown in Figure 3.2 below.

Figure 3.2: Vehicle Utilization for SNT

50

70

90

110

130

150

2004-05 2005-06 2006-07 2007-08

Year

Veh

icle

U

tili

sati

on

(%)

Bus

3.9 Fuel efficiency

The distance traveled by the bus per litre has increased from 2.8 during 2004-05 to 3.14 in 2007-

08 falling short of the national average standing at around 3.48 for hill operations. Figure 3.3

shows the steady increase in this parameter during 2004-05 and 2007-08.

Figure 3.3: Fuel efficiency

2

2.5

3

3.5

4

2004-05 2005-06 2006-07 2007-08

Year

KM

PL

Bus

3.10 Routes under Operation

The number of routes under operation has reduced from 43 to 35 during 2004-05 and 2007-08.

This is a result of reducing fleet size of SNT post 1997-98 which has witnessed a 50% reduction in

its fleet from 155 in 1997-98 to the present 75 in 2007-08.


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3.11 Freight operations

As far as freight operations are concerned, SNT has a fleet of 83 vehicles

comprising of trucks and tankers as summarized in Table 3.6. It is evident that

the fleet strength of SNT was 122 at the end of 9th Five Year Plan and has gone

down to 83 as observed in the first year of 11th Five Year Plan. The reason for

decrease in the fleet size is attributed to the fact that there was no balance

between the number of vehicles scrapped and number of vehicles added.

Table 3.6: Fleet Strength of Truck & Tankers

Five Year Plan End of the year Fleet of trucks &

tankers

9th

Five Year Plan 2001 - 02 122

10th

Five Year Plan

2002 - 03 104

2003 - 04 92

2004 - 05 80

2005 - 06 90

2006 - 07 92

11th

Five Year Plan 2007 – 08 83*

* Value corresponds to data as on 31st

March 2008

3.12 Manpower Strength

The current manpower at SNT is 904. Details of the staff are given in table 3.7 below.

Table 3.7: Category of Employees at SNT

Sl. No.

Category of Employees

Number of Employees

Regular Work

Charge Muster

Roll Constd.

Pay Co-

Terminus Total

1 Gazette 34 - - - - 34

2 Non-Gazette 737 57 70 1 5 870

Total 771 57 70 1 5 904 Source: Sikkim Nationalised Transport

3.13 Staff and Crew Productivity


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The staff and crew productivity has reduced to 9.87 during the current year from

10.11 last year. This is around 70% less than the national average for hilly

operations. The staff and crew productivity has been on a downhill since 2005-

06. The main reason for this reduction is the decrease in fleet strength resulting

in lower volume of operation.

3.14 Conclusions

From the insight into the past, it is evident that Sikkim Nationalised Transport,

through its operation of commercial vehicles, has provided basic infrastructure

in the State since its inception. The department was successful in achieving its

objective “to provide an efficient, adequate, economic and properly co-

ordinated road transport system in the State for promotion of rapid economic

growth”. However, in the recent past, Indian Institute of Cost and Management

Studies and Research (INDSEARCH) has carried out a study on performance of

PSUs in Sikkim as mentioned in the report “Vision Document”. It was

recommended to close down/privatize four enterprises which include Sikkim

Nationalised Transport. Further, it was mentioned that SNT has not made any

profit since 1990-91 and the total deficit (expenditure minus revenue) has

almost tripled between 1993-94 and 1995-96, from Rs 3.6 crore to Rs 9.6

crore, and the same has also reflected in the rise in loss per kilometre from Rs

6.34 in 1993-94 to Rs 12.07 in 1995-96.

From this recommendation, it is evident that only one perspective based on

commercial viability alone was considered and no thought was given to the

strategic role of SNT in Sikkim. The multiple perspectives based on which it

could be stated that the SNT would play a crucial role not only in present but

also in future are as follows:

Sikkim has international borders with China, Bhutan and Nepal. Most of

the Indian Army Camps are located at various places in Sikkim. It is


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obvious that the task to provide passenger and freight transport services

to these destinations cannot be given to private operators. Considering

the strategic importance of Sikkim, it would be appropriate that the

Government of Sikkim continues to provide passenger and freight

services to the army and other Government Departments.

Due to its low population densities and importance of providing basic

transport services across the state, the relevance of provision of

transport services through SNT cannot be undermined. SNT has been

providing efficient and economic transport service to the state without

any consideration of profit/loss and should continue to do so in the

future.

It has been established that complete privatization is not the solution,

specially since providing transport services is of strategic importance in a

state like Sikkim. The population pockets are widely scattered and the

geographical terrain makes it very difficult to operate transport service.

As a result, the cost of operation increases on one hand while on the

other the revenue earned on most of routes is not significant. Such

scenario would raise a question mark on sustainability of private

operators in the long run.

3.15 Recommendation

SNT should play a regulatory role along with the Motor Vehicle Department in

controlling and planning Transport Operations on behalf of Government of

Sikkim. This would include planning the growth of transport services in the state

and deciding the number and routes on which maxicabs should operate

including the fares to be charged. SNT should focus on expanding freight

operations along with maintaining strategic fleet in passenger transport

operation to cater to the needs of army and other government departments in

addition to socially obligatory services and providing transport services from

state capital to District Headquarters. It is also recommended that SNT should


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continue to function as a Government Department with exclusive funding from

the state since an organization under any other format would not be able to

sustain itself given the low profitability associated with the routes and the social

obligation which needs to be carried out.


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Chapter 4

PASSENGER TRANSPORT SERVICES IN SNT

4.1 Introduction

SNT has been providing passenger transport services to the citizens of the state of Sikkim apart

from playing a major role in providing passenger and freight services to the Army, Food

Corporation of India and other Government Departments. Although, due to adequate support

from the State Government in the early years, the passenger transport services had shown a

growing trend, the fleet size has reduced in the recent past. Due to the strategic importance of

Sikkim, it is imperative that SNT should be supported to improve the condition of its fleet. The

services which have discontinued have to be revived and basic services have to be provided to

various locations as a social obligation of the State Government. An attempt has been made in

this Chapter to review the existing operations of SNT and recommend measures to make services

more accessible to people of the state.

4.2 Review of existing operations

Passenger transport services provided by SNT are carried out through three depots at Gangtok,

Rangpo, and Jorethang. The Gangtok depot operates 17 bus routes with 21 schedules. Rangpo

depot operates two routes with 3 buses in addition to providing buses for school trips. The

Jorethang depot caters to nearly 50% of all bus operation of SNT and collects about 23% of total

revenue earned from passenger transport services in the state through operation of 20 routes

with 24 buses. There are 3 sub-depots attached to Jorethang namely Geyzing sub-depot which

operates 2 routes with 3 buses, Namchi sub-depot which operates 8 routes with 10 schedules

and lastly Ravangla sub-depot which operates 2 routes with 3 buses.

There are currently three passenger terminals located at Siliguri, Gangtok and Jorethang. The

passenger terminals at Mangan and Rhenock are closed for past 5 years. There are 11 bus

stations namely Gangtok, Rangpo, Siliguri, Mangan, Rhenock, Singtam, Jorethang, Namchi,

Gayzing, Ravangala and Sombaria.

SNT has taken a good initiative in starting Passenger Reservation System (PRS) counters at

Gangtok, Namchi, Jorethang, Geyzing, Singtam and Mangan covering the entire population of

State of Sikkim. The passenger terminal at Siliguri needs to be revamped in terms of facilities and


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information system for passengers. The following picture shows that the Siliguri passenger

terminus needs to be upgraded and equipped with modern amenities to attract passengers.

Figure 12: Siliguri terminus – Need for upgradation

4.3 Recommendations for improving the traffic operations

A few measures, which can help in reviving SNT’s public transport operations, have been

mentioned below:

1. SNT should give emphasis on operating their buses on inter district routes

especially originating from Gangtok to various district head quarters.

2. New schedules can be provided from Gangtok to the following towns

a. Namchi to increase tourist attraction

b. Ranipool at a higher frequency using mini buses (say 15 minutes, since

currently, only 5 buses are plying with poor frequency.The following bus

routes may be reinstated

c. Geyzing- Siliguri

d. Jorethang to Heegaon (14 contract carriage permit taxis are plying)

e. Jorethang to Uttare near Nepal border (72 taxis are plying from Uttare)


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f. Jorethang to Ravangla (Currently about 51 contract permit taxis are estimated

plying from Ravangla) 3. It is also recommended that SNT must find new areas of operation as per the passenger

demand to increase their passenger base. It is suggested that SNT may start new

International routes from Gangtok to Phuentsoling (Bhutan) and Kathmandu (Nepal),

since there is lot of tourist influx into these areas. It is also proposed that new inter state

routes could be operated to Calcutta in West Bengal and Bodhgaya in Bihar. This can be

easily be implemented since the Government of Sikkim already has the permits from

other states to ply their bus service. The routes may be operated on route franchise

basis through private operators or through hiring of buses.

4. It is seen that due to less public transport services, the passengers are compelled to

travel by taxis. Currently, 1560 taxis are plying locally in Gangtok and 500 local taxis in

Ranipool are catering to the passenger demand. Increase in the number of taxis is a

direct indication of the dearth or absence of public transport service in the area. If a

reliable and frequent bus service is provided by SNT, the number of taxis will surely

reduce and lead to less congestion in the city of Gangtok apart from providing an

economical transport service to the commuters.

5. Introduction of subsidized Daily Pass System in city operations in Gangtok will help in increasing the customer loyalty for SNT. The pass would be non-transferable with photo identity to avoid misuse.

6. It is observed that SNT cancels its bus operations from Siliguri and other depots due to

sudden demand by army. This practice of providing buses to Army by canceling the

existing schedules should be minimised. Since it is important to cater bus passenger

services as per schedule to maintain reliability of service, there should be least

cancellation of trips and a minimum of two trips must operate from Siliguri daily in the

morning to meet passenger demand. This initiative is highly essential to increase the

customer loyalty and reliability of SNT services. The early morning service reaching

Gangtok around 10 a.m. should be necessarily operated preferably with new buses.

7. Frequency of buses during peak hours should be increased. There should

be least cancellation of trips.

8. On major routes like Siliguri to Gangtok, SNT would have to promote

branded services like “Red Panda”.

9. After computerization, focus should be on online reservation system

through booking agents, especially in places where SNT currently doesn't

have own counters.


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10. It was observed that data at the depot level is being maintained by

vehicle number and not route-wise. Hence, it is recommended that in

order to observe the passenger demand on all corridors in Sikkim, it is

essential to maintain data route-wise and review it periodically. This

would include trip time, origin of the bus, destination of the bus, total

earnings, kilometers operated, earning per km. and load factor. The data

maintained in this format shall help SNT to monitor the passenger

demand trip-wise throughout the day on all routes in Sikkim and take

corrective measures, if any.

11. It was also observed that the physical state of passenger terminals at

Siliguri, Gangtok and Jorethang need a revamp. The passenger terminal

is the face of SNT for the public and plays an important role in projecting

the image of SNT. In order to attract more passengers from taxis to SNT

buses, the passenger terminals need to have well designed signage

system for passenger information, good public utilities, clean premises

and waiting area with proper seats for passengers. This aspect needs to

be addressed and new look terminals have to provided. These terminals

could be used by Intermediate Pubic Transport modes as well for local

transfers.

12. It is observed that SNT charges the same fares for ordinary and express services. This

needs change in the fare policy. The objective is to provide different type of services as

per the segment of potential passenger demand. The two services should be

differentiated in terms of fares to be charged and the type of bus to be provided.

4.4 Generation of non-traffic Revenue In addition to the primary income through ticket sale, there are always

possibilities to realize other sources of income in any business model. It is

essential to add additional revenue streams without investment in extensive

development, but merely by exploring existing possibilities from a fresh

perspective. Considering the low population densities in Sikkim, it may not be

attractive for manufacturers to advertise their products on the buses of SNT.


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However, the possibilities of earning additional non-traffic revenue from

advertisement of bus panels may be explored. Similarly, space for hoardings at

bus stations at SNT may be rented to earn non-traffic revenue.

Since SNT owns a considerable number of properties within Sikkim and at

Siliguri, there is immense scope for development of these properties to earn

revenue through rentals. It is understood that SNT has earmarked lands at

various locations like Matigera and Pradhan Nagar for commercial revenue

generation. Similarly, the existing SNT bus stand located near Tenzing Norgay

bus terminus has a lot of potential for commercial exploitation. Since the

location of the existing bus stand in Siliguri is in the heart of the city, a modern

bus station with facilities for paid parking of vehicles, commercial space for rent

and advertising space may be planned to earn non-traffic revenue.

Since Rangpo is likely to develop as an important industrial town in the future a

similar bus station cum commercial complex may be developed at the land

belonging to SNT.

4.5 Control on leakage of revenue

It is essential to organize the enforcement function in SNT to control the leakage of revenue.

However, a large amount of revenue does not come to SNT due to presence of large number of

maxicabs operating in Sikkim. A share of this revenue could be realized by SNT by providing a

higher quality of service. To control leakage of revenue on the route a strong line checking

mechanism has to be created. The objectives of this activity are

- To induce the conductor to issue tickets

- To induce the passengers to insist on a ticket

- To detect pilferage prone employees

- To know the existing demand and travel pattern on the route.

This line checking could be organized as follows:

- Surprise checks by headquarter squad


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- Routine checking through staff who could be made responsible for increase in revenue.

This staff would also suggest changes in time table to increase patronage of service.

Once the leakage of revenue is controlled through enforcement measures, an incentive scheme

could be designed for the crew where a share of the revenue (say 3%) is given as incentive. At

the same time, it is important for the supervisory staff at the depot to monitor the trip wise and

conductor-wise revenue to identify services providing inadequate revenue.

4.6 Breakeven analysis

An attempt has been made to determine the breakeven point for buses at the current fare level

assuming a utilization of 160 km./day. The problem with such a viability calculation is that if the

total cost of the organization is appropriated to the vehicles, the breakeven would be achieved at

unachievable levels. Therefore, only the direct personnel cost comprising of 2 drivers and 2

conductors has been taken for the calculation. A central overhead of Rs. 5000/- and

maintenance staff of 3/5 per bus has been assumed. Similarly, appropriation for supporting staff

has been made. Other variable costs have been assumed on existing cost basis. The analysis

shows that SNT would have to earn a EPKM of Rs. 33.20 to breakeven and the load factor

required would be about 87%. At the current load factor of 58%, the fare per km. should be Rs.

1.51 to breakeven. The detailed calculations including costs assumed are given in Annexure 4.1.

The breakeven fare at different levels of load factor is given in Annexure 4.2. By using an excel

sheet, any changes in the input costs like fuel could be changed to determine the increase in fare

per passenger km.


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Annexure 4.1

BREAKEVEN LOAD FACTOR AND FARE FOR BUSES

FIXED COST

kms/bus on road/ day 160

No. of Operation days per annum 300

Total kms per annum 48088

Cost of Bus 1200000

Useful life in years / lakh Km 5 / 5.00

NPV of Salvage (Rs.1.20 L after life) 12,000

Depreciation cost per annum 114258

Depreciation cost/ km 2.38

Interest Cost (10% pa) 120000

Interest Cost/ km 2.50

Central Over Heads @ Rs 5000/- per bus per month 60000

Central Over Heads cost/ km 1.25

Drivers & Conductors Salaries (2 each @ Rs. 11810/- and Rs. 11225/- respectively p.m.)

552840

Workshop & Maint Staff ( 3 persons per every 5 buses @ Rs. 10350/- p.m.)

74520

Admn., Accounts, Supervisory & other staff (2 persons per every 10 buses @ Rs. 15605/-)

37452

STAFF Cost Per annum 664812

STAFF Cost/ km 13.82

Fixed Cost Per Km 19.94

VARIABLE COST

Motor Vehicle Tax 0.11

Fuel cost/ km 11.15

Cost of Fuel per litre 35

Assumed Fuel average / litre 3.14

Lubricants cost/ km @ 5% of fuel cost 0.56

Tyre cost/ km ((C32/C34)*6) 1.44

New tyre price 4000

Retreading charges per tyre 2000

No. of Tyres 6


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Retreadibility factor 1

Tyre life = New+RTd 25,000

Variable Cost Per Km 13.26

TOTAL CPKM 33.20

BREAKEVEN LOAD FACTOR

Net EPKM (Traffic Revenue) required for breakeven 33.20

Average Fare Charged per Passenger Km 1.00

L.F. Req. for Breakeven (C.C.= 38) to recover total cost 87.4

FARE PER PASSENGER KILOMETER

Carrying Capacity 38

Current Load Factor 58

Profit Margin in % 0%

EXPECTED EARNINGS PER BUS KM. 33.20

PROPOSED FARE PER PASSENGER KM. 1.51

BASIS:

1. Capital Cost per vehicle ~ Rs.12.0 lacs

2. Bus is Operational for 300 days per year @160km/day

3. Fuel Cost = Rs. 35/- per Litre

4. Fuel Mileage = 3.14 kmpl

5. Tyre Life = OE (18k kms) + One Retread (7k kms)

6. 100% Finance assumed

7. 10% Rate of Interest for a tenure of 10 yrs assumed

8. 160 km/day = 109 Vehicle Utilisation / 68% Fleet Utilisation

9. Motor Vehicle Tax is Rs. 3943 per 27 seater plus Rs. 128/- for every additional seat beyond 27 upto 45 seats

Annexure 4.2

Load Factor Proposed Fare per Passenger Kilometer


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50 1.75

60 1.46

70 1.25

80 1.09

90 0.97

100 0.87


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Chapter 5

FREIGHT OPERATIONS IN SNT

5.1 Introduction

In Sikkim the freight transport services are provided both by Sikkim Nationalised

Transport (SNT) and Private operators. However, the operation of private trucks

is monitored by SNT through collection of supervision charges from trucks

entering Sikkim. To study the freight operations in Sikkim, the team has done a

reconnaissance survey to assess the ground reality besides having discussions at

check post, terminal and head office with officers and staff including drivers.

The survey and discussions have revealed that SNT is providing point-to-point

service as and when informed by consignee. Further, in order to meet excess

demand, SNT is hiring the services of private operators. The regular consigners of

SNT include Armed Force, FCI and Govt. of Sikkim. It was also learnt that the

Govt. of Sikkim has made it compulsory that the transportation of good meant

for government purpose are carried by SNT or under arrangement authorized by

SNT. The armed forces have been continuously hiring the services of SNT on

yearly renewable contract basis. It was also found that Siliguri in West Bengal is

an important place especially from operational point of view because it is not

only the entry point to Sikkim but also an important loading point (i.e. NGP,

Bangdupi and TCP). Most of the trucks and tankers movement (irrespective of

private or SNT owned) takes place from Siliguri to various destinations in Sikkim.

In case of truck operation, assigning of final destination and loading is done in

Siliguri. However in case of tanker operation, no final destination is assigned at


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Siliguri; all tankers on their way to Sikkim report at the depot of the consignee

(i.e. IOCl / BPCL) for knowing the final destination. IOCL depot is situated at

Bagekola and BPCL depot is situated at Mageteri. For assigning the final

destination to SNT tankers (owned/ hired) there are representatives from SNT in

both depots. All private tankers move under SNT’s supervision and a statement

“Under SNT’s supervision” is inscribed on the tanker.

All trucks and tankers enter Sikkim through either Malli check post or Rangpo

check post where SNT have their counters. Further, it was learnt that majority of

freight movement is passing through Rangpo check post. At these counters, SNT

is collecting supervision charges from private operators besides details like

origin, destination, quantity of material carried etc. It was revealed that the

private truck and tankers carrying essential commodities like rice, milk etc., are

exempted from supervision charges.

5.2 Freight operation in SNT: Performance and challenges

The following data was collected to analyse the freight operation in SNT

Data pertaining to utilization of trucks during the year 2007-08.

Month-wise performance of SNT

One-week data on movement of trucks and tankers owned and hired by SNT.

One-week data on movement of private trucks and tankers not hired by SNT from

Rangpo check post.

SNT’s Annual Report 2006-07.

The information obtained from the one-week sample data was analyzed to determine the

following variables:

Overall share of SNT in freight movement (one week sample)

Model wise & age wise performance of SNT’s trucks

Potential routes/areas

Turn around time

Accordingly, the result of the analysis has been summarized as follows:

From the Table 5.1, it is evident that


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Out of 261 vehicles traveled, 207 vehicles are private owned vehicles comprising of 129

trucks, 42 DCM and 36 Utility. The percentage share of private vehicles amounts to 79%.

Total 914 trips have been performed by the above 207 vehicles and the corresponding

percentage share in total number of trips is 87%.

The remaining 54 vehicles comprised of SNT owned and hired vehicles which performed

142 trips in a week. When expressed as percentage share in the total number of

vehicles, it works out to be 21% while in number of trips performed works out to13%.

This lower percentage of trips performed by a higher percentage of vehicles could be

attributed to higher periods associated with completion of trips performed by SNT

vehicles.

Table 5.1: Truck movement in Sikkim

Operator Type of Vehicle

Number of Percentage of

Veh. traveled

Onwards Trips

Performed

Veh. traveled

Onwards Trips

Performed

SNT owned Trucks 28 64 11 6

SNT hired Trucks 26 78 10 7

Private

Trucks 129 560 49 53

DCM 42 183 16 17

Utility 36 171 14 16

Total 261 1056 100 100

A similar scenario has also been revealed from the analysis of tanker movement. The result has

been summarized as follows and the details are given in Table 5.2.

In a week, 77 tankers have traveled and performed 370 trips. Out of these, 18 tankers of

SNT have performed 62 trips and rest (i.e. 59 vehicles) traveling under supervision of

SNT have performed 308 trips.

Percentage share of SNT owned vehicles and vehicles traveling under supervision of SNT

are 23% and 77% respectively.

17% and 83% is percentage share of trips performed by SNT owned vehicles and

vehicles under SNT Supervision.

Table 5.2: Tanker movement in Sikkim


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Tanker Number of

Veh.

Percentage of onwards Trips

Performed Veh.

Onwards Trips

Performed

SNT owned 18 31 23 17

SNT's Supervision

59 154 77 83

Total 77 185 100 100

It is evident from the above tables that the share of private vehicles is substantial. To

understand the nature of goods carried by private vehicles and their destinations, these

parameters were analysed in figure 5.1 and Table 5.3 and the following observations were

made.

5.3 Type of goods carried

1) Frequently carried goods include Cement, Bricks, Vegetables, M goods, T goods,

Medicine and Coal.

2) Out of the total 326 consignment carried, where the details of nature of goods carried

were available, 169 consignments comprised of construction materials only.

Figure 5.1: Material wise no. of consignments carried by private trucks

Note: Details regarding type of goods carried by 588 consignments was not available

60

109

211

4

28

3 3

22

72 4 4 6 5

2432

0

20

40

60

80

100

120

BRIC

KS

CHEM

ICAL

E.BOTTEL

MAC

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E

MED

ICIN

E

PRIN

TING IN

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5.4 Destination of goods

Table 5.3 reveals the nature of goods being transported to various destinations in Sikkim. It is

evident that movement of construction material is spread across the state indicating

development activities across the state.

Table 5.3: Origin-Destination (goods wise)

Type of Goods Origin Destination No. of Trips

Bricks B/Pool Kharey 7

Mazitar 4

Rangpo 4

Siliguri Begaykhola 5

Gangtok 9

Mamring 4

Mazitar 5

Namthang 4

Pakyong 5

Ranipool 5

Sangkhola 2

Singtam 3

Tinkek 3

Cement B/Pool Kharey 7

Siliguri Begaykhola 4

Chungthang 27

Gangtok 9

Kharey 4

Mangan 9

Pakyong 14

Rangpo 4

Ranipool 12

Singtam 15

Tadung 4

Chemical Siliguri Begaykhola 1

Mamring 1

Coal Siliguri Mamring 11

E.Bottel Singtam Jorthang 4

M Goods Siliguri Chungthang 2

Gangtok 4

Mangan 4

Rangpo 5

Ranipool 9

Rongli 4

Machine Siliguri Jorthang 1

Kumrek 2

Maida Siliguri Mining 3

Medicine Mamring Siliguri 3

Sangkhola Siliguri 19


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Type of Goods Origin Destination No. of Trips

Noodle Mamring Siliguri 7

Printing Ink Mamring Siliguri 2

P V Foam Begaykhola Siliguri 4

Quartz Siliguri Mamring 4

Rods Siliguri Sangkhola 2

Singtam 4

Spare Parts Siliguri Sirwani 5

T goods Siliguri Gangtok 10

Ranipool 4

Singtam 10

Vegetable Siliguri Namthang 5

Rangpo 5

Singtam 22

Total 326

Initially, it was thought that there is a need to impose some restriction on movement of private

trucks carrying construction materials to make it mandatory for private trucks to carry essential

commodities upto a certain defined level. However, this restriction would interfere in the

development of Sikkim. The other way of solving this problem is to increase the supervision

charges on trucks carrying construction material, say by10% per trip and to give same percent of

concession when the same truck carries goods other than construction materials. Further, this

concession shall be valid if the trips are performed in the same month.

5.5 Challenges for SNT

The challenges that are faced by SNT are not only internal but also external. The

internal problems include operation of old fleet, reducing fleet size and lacunae

in system of co-ordination of freight movement while external problems include

competition from private operators, narrow roads with many bends, land slide

prone areas, excessive fog in particular seasons and – altitude effect causing

breathing problems etc.

SNT is providing freight services with fleet comprising of 50 trucks and 33 tankers. Age wise

breakup of fleet is given in table 5.4. It is evident from the table that 9 trucks and 24 tankers are

of age 10 years and above.

Table 5.4: Fleet position according to age of the vehicles Age (no. of years) ref.

year 2009 Trucks (no’s) Tankers (no’s)


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Age (no. of years) ref. year 2009

Trucks (no’s) Tankers (no’s)

1-2 13 2

3-4 10 2

5-6 7 0

7-8 11 5

9-10 0 0

11-12 5 4

13-14 3 0

15-16 0 6

18 and above 2* 14

Total 51 33

* : includes one recovery vehicle

Table 5.5 gives the age-wise performance of trucks.

Table 5.5: Age-wise performance of truck in the year 2007-08

Age (no. of years)

No. of Trucks Average (per truck)

Kms operated Qty (des)

1 to 4 23 19308 593

5 to 9 16 18874 559

10 & above 10 10677 303

It is clear from Table 5.5 that trucks with age less than 9 yrs have been effectively utilized.

However, the trucks in the age group of 10 and above have not performed well. It is also evident

from the table that these trucks have covered less kilometer and carried comparatively less load.

The major reason could be that these trucks have been off road for longer times. On the other

hand, trucks with age less than 10 yrs have operated approximately double the kilometer than

the trucks with age more than 10 years.

5.6 Identification of major freight corridors

From the analysis of the one-week data regarding private trucks, major freight

corridors have been identified. It is estimated that out of 914 trips performed

in a week, approximately 71 per cent trips (i.e. 648 trips) are performed on

corridors detailed in table 5.6 below .

Table 5.6: Major Freight corridors

Origin Destination Number of Trip Percentage share

Siliguri Chungthang 31 3.39

Siliguri Gangtok 235 25.71


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Siliguri Mamring 37 4.05

Siliguri Pakyong 45 4.92

Siliguri Rangpo 72 7.88

Siliguri Ranipool 88 9.63

Siliguri Singtam 140 15.32

Total 648 70.90

The analysis of the data for SNT trucks and trucks hired by SNT reveals that the

total number of trips performed in the week were 1056, out of which 68 percent

(i.e. 711 trips) have taken place on the 8 corridors detailed in Table 5.7.

Table 5.7 : Major freight corridors

Origin Destination Number of Trip Percentage Share

NJP JRT 58 5.49



Siliguri Mazitar 32 3.03





Total 711 67.62

It is obvious from the tables that all potential corridors are originating from Siliguri. The

percentage share of the freight trips between origin-destination for private trucks are given in

Annexure 5.1 while the percentage trips for SNT vehicles and vehicles hired by SNT are given in

Annexure 5.2.

Sikkim Nationalised Transport has also provided “vehicle wise & trips wise

statement for utilization of trucks during the year 2007-08”. On analysis of the

data, it is seen that the major freight corridors being served by SNT comprise

of army movement to bases like Changu, Makha, Rangma Range etc. The

major corridors served by SNT are given in Table 5.8 below.


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Table 5.8: Major destinations served by SNT

Origin Destination No. of trips Percentage of total

trips

RGP {C/S}S 343 9.24

RGP Makha 195 5.25

TCP Changu 607 16.36

TCP Rangma Range 288 7.76

Bengdubi FSD Gangtok 264 7.11

Considering the likely pattern of freight movement as far as essential commodities are

concerned, the major freight corridors in Sikkim would comprise of Siliguri to district

headquarters since the distribution of commodities would take place from the district

headquarters to remote areas. The district headquarters would form the logistic node for goods

transportation in the state. In the future, it is likely that Rangpo will develop in to a major

warehousing centre and goods movement to all districts in Sikkim would take place from

Rangpo. The proposed rail accessibility to Rangpo would facilitate the emergence of Rangpo as

the logistic hub of Sikkim.

5.7 Strategies to reduce turnaround time

Turnaround time is defined as the average time elapsed between the truck’s

arrival at your facility and it is departure after completing the necessary paper

work and loading process. This has a significant impact on profit only when

loading and paper work handling is carried out in same premises.

During the team’s visit to Pradhan Nagar truck terminal, it was observed that the

consignment is assigned as and when informed by the consignee. The type of

process adopted for allocation of vehicle was first in first out. It was observed

that the time required for paper work was very less though it is carried out

manually. Further, it was informed that the loading is carried out at the place

specified by consignee.

With respect to truck waiting time for loading and unloading, SNT has informed

that at F.C.I the loading time allotted is 7 hrs. and unloading time is 2 hrs.


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However, it was learnt from the discussion with drivers that the actual time

taken for loading/unloading is more than what has been specified. It is evident

that the delay is from consignee’s side. SNT may consider making financial

provisions to employ contract labour for loading/unloading of goods to reduce

turnaround time.

To increase the utilization of trucks, it is recommended that SNT should focus on

setting up of a systematic information data base. The information system should

have details like time of arrival of truck on return to origin after unloading,

fitness/preparedness of truck to take up next trip etc. It will help SNT to use their

resources optimally and monitor the movement of vehicles. Further, it is

recommended that a vehicle tracking system may be installed on all vehicles.

The details like the concept of Vehicle Tracking System (VTS), need for VTS and

the features of GPS based VTS are as follows.

5.8 Need for Vehicle Tracking System

Any business with multiple vehicles, whether 4 or 40 or 400, faces numerous

challenges as it seeks to increase vehicle utilization, reduce costs, improve

customer service and reduce the risk of breakdown.

5.9 Concept of Vehicle Tracking System

A GPS tracking system is easy to deploy and use. Each vehicle, that needs to be

tracked, need to be installed with a vehicle tracking unit (VTU), which is a small

hardware unit consisting of a GPS receiver and a GPRS communication module.

The Global Positioning System (GPS) consists of a network of 24 satellites placed

into orbit by the U.S. GPS satellites circle the earth and transmit signals to the

earth. The GPS receiver uses signal from multiple satellites, to calculate the

location of a vehicle. The GPRS module in turn, transmits this location


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information to the Internet tracking server, over the GPRS data network

provided by GSM cellular operators. Transporters can now track their vehicles,

on digital maps, by logging onto the Internet tracking website, using a username

and a password provided by tracking service provider.

5.10 Key features of GPS vehicle tracking system

Monitor all halts with exact time & duration and location of each halt.

View accurate trip sheets with exact time of arrival and departure at given location

Get accurate log of kilometers driven

Monitor over speeding violations with location, distance and timestamps.

Provide storage of report for a reasonable amount of time ranging from 6 months to a

year

Provide alerts in case driver attempts to tamper with the VTU or tries to disconnect it

from the main battery of the vehicle

5.11 Breakeven analysis for freight operation

An attempt has been made to determine the breakeven point in terms of vehicle

utilisation for trucks at the current rates of tonnage per km. The analysis has

been done under two different scenarios as follows:

i) where the average revenue earned per km. is Rs. 50.93 based on the data

collected from Siliguri regarding freight operations in SNT.

ii) where the average revenue earned per km. is Rs. 65.36 based on the

ideal scenario where the total capacity of 8 MT. is being carried by the

truck.

Under the two different scenarios, the breakeven vehicle utilization is calculated

as

i) 91 kms. per day in the first case

ii) 59 kms. per day in the second case


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The details of the calculation and costs assumed is given in Annexure 5.3. The

costs associated with the calculations are assumed under ideal circumstances.

However, the actual costs could be substituted to modify the model. Moreover,

the direct personnel cost associated with the operation of the truck is considered

for the model. In case the entire personnel cost of SNT is appropriated in the

model, the breakeven utilization would be higher.


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Annexure 5.1

Origin Destination Number of Trip Percentage share

B/Pool Gangtok 4 0.44

B/Pool Kharey 14 1.53

B/Pool Mazitar 12 1.31

B/Pool Rangpo 4 0.44

B/Pool Singtam 3 0.33

Begaykhola Siliguri 6 0.66

Kumrek Siliguri 5 0.55

Mamring Siliguri 15 1.64

Mazitar Siliguri 2 0.22

Sangkhola Siliguri 19 2.08

Singtam Jorthang 4 0.44

Singtam Siliguri 4 0.44

Siliguri Begaykhola 14 1.53



Siliguri Jorthang 1 0.11

Siliguri Kharey 4 0.44

Siliguri Kumrek 23 2.52


Siliguri Mangan 29 3.17


Siliguri Mining 8 0.88

Siliguri Namthang 14 1.53




Siliguri Rongli 14 1.53

Siliguri Sangkhola 19 2.08

Siliguri Singik 6 0.66


Siliguri Sirwani 5 0.55

Siliguri Tadung 4 0.44

Siliguri Tinkek 3 0.33

Total 914 100.00

Annexure 5.2


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Origin Destination Number of Trips Percentage Share

B/Pool Gangtok 4 0.38

B/Pool Kharey 14 1.33

B/Pool Mazitar 12 1.14

B/Pool Rangpo 4 0.38

B/Pool Singtam 3 0.28

Begaykhola Siliguri 6 0.57

Kumrek Siliguri 5 0.47

Mamring Siliguri 15 1.42

Mazitar Siliguri 2 0.19

NJP JRT 58 5.49

Rhsd Fsd/Gtk 22 2.08

Sangkhola Siliguri 19 1.80

Sbd/532 Lachung 12 1.14

Sbd/533 Rongli 4 0.38

Singtam Jorthang 4 0.38

Singtam Siliguri 4 0.38

Siliguri Begaykhola 14 1.33



Siliguri Jorthang 1 0.09

Siliguri Kharey 4 0.38

Siliguri Kumrek 23 2.18


Siliguri Mangan 29 2.75


Siliguri Mining 8 0.76

Siliguri Namthang 14 1.33




Siliguri Rongli 14 1.33

Siliguri Sangkhola 19 1.80

Siliguri Singik 6 0.57


Siliguri Sirwani 5 0.47

Siliguri Tadung 4 0.38

Siliguri Tinkek 3 0.28

TCP Changu 22 2.08

TCP R/Range 18 1.70

Total 1056 100

Annexure 5.3

FARE REVISION MODEL FOR TRUCKS

(I)

INPUT COSTS

CAPITAL EXPENSES: 8T Truck

Cost of New Vehicle 1000000


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Life assumed in years 10

Rate of Interest on Capital Cost 10%

Salvage value assumed as percentage to new vehicle cost 10%

FIXED COSTS:

Registration & renewal annual expenses per annum 2000

Motor Vehicle Tax per annum 6000

Insurance Premium per annum 20000

Driver's Salary per month including allowances 10000

Attendant's Salary per month including allowances 5000

Bus Staff Ratio (Driver & Cleaner) including leave reserve 1.30

Administrative Staff Cost per month 7205

Counter / Office maintenance per month 1000

Printing & Stationary expenses per month 500

Telephone & Other Misc Expenses per month 250

Repairs & maintenance cost per month 7500

VARIABLE COSTS:

Cost of fuel per litre 40.00

Kilometers per litre of fuel 1.57

Percentage of Oil & Lubricants Cost to Fuel Cost 4.6%

Cost of one tyre with tube 4000

Tyre life assumed in Kms. 25000

Repairs & Maint. cost per month including spares and manpower per month 7500

(II)

COST BASED FARE COMPUTATION TABLE

EXPENDITURE HEAD : Rs. Per Annum

8T Truck

1) Fixed Costs

a) Cost of financing (Repayment + Interest) 200,000.00

b) Registration & renewal annual expenses 2,000.00

c) Motor Vehicle Tax 6,000.00

d) Insurance Premium 20,000.00

e) Driver's Salaries 156,000.00

f) Attendant's Salaries 78,000.00

g) Administrative Staff 86,460.00

h) Counter / Office rentals 12,000.00

i) Printing & Stationary expenses 6,000.00

j) Telephone & Other Misc. Expenses 3,000.00

k) Salvage Value spread over life span 90,000.00

l) Repairs & Maintenance 90,000.00


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Sub-total (a to l) 749,460.00

Rs. Per Km.

2) Variable Costs

a) Fuel 25.48

b) Oil & Lubricants 1.17

c) Tyre, tubes 0.96

Sub-total (a to c) 27.61

Number of Working Days 300

Case 1

Average Revenue Earned per km 50.93

Effective Kilometers per Annum 32138

Breakeven Vehicle Utilisation (km/day) 107

Case 2

Fare Charged per Metric Tonne Kilometer 8.17

Capacity of Truck 8

Fare per 8MT kilometer 65.36

Effective Kilometers per Annum 19853

Breakeven Vehicle Utilisation (km/day) 66


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Chapter 6

INFRASTRUCTURE DEVELOPMENT 6.1 Introduction

Given the importance of SNT in provision of basic passenger and freight services in the state it is of utmost importance that development of necessary infrastructure is accorded top priority. Since Sikkim is a landlocked country with difficult terrain, road transport is the only means of transport available in the state. With the commissioning of the rail link between Sevoke in West Bengal to Rangpo in the future, the logistics of goods transportation in the state would undergo a sea change. It is also important that infrastructure in terms of bus station and allied facilities is commercially exploited to earn non-traffic revenue. It is understood that SNT is in the possession of prime land at various locations in Sikkim and Siliguri which need to be developed to earn additional revenue and provide modern services in the field of passenger and goods transportation. At the same time, necessary infrastructure has to be created to improve the management information system and use technology for improvement in productivity and save manpower. This chapter makes an attempt to suggest relevant areas where an initiative could be taken to develop infrastructure to improve the efficiency of the organization and earn additional revenue.

6.2 Development of land and property

There is immense scope for development of infrastructure at various places like Siliguri, Rangpo, Jorethang and Gangtok where SNT is in possession of prime properties.

6.2.1 Siliguri

Siliguri has emerged as an important city in West Bengal and is an important gateway to the north-east. Owing to its strategic location, it has emerged as a base for supply of goods to the north-east and a nodal hub for passengers traveling to various states in the north-east. Therefore, Siliguri has experienced considerable growth in the recent past making it attractive for growth of business. Due to this growth, various commercial properties are being developed in Siliguri. SNT has earmarked lands at various locations like Matigera and Pradhan Nagar for commercial exploitation through development of the property. The existing bus terminal of SNT near the Tenzing Norgay bus terminus has a strategic location and a lot of potential for commercial exploitation. It is recommended that the land may be used for construction of multi-storeyed complex comprising of a bus terminus with the following facilities.


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1. Basement parking which can be extended to personalised vehicles.

2. On the ground floor, platform for buses, seating facilities for passengers, drinking water

facilities, office of SNT, parking for SNT buses, reservation counter, PIS, waiting room for

passengers of high end services telephone boots, medical shops, fruits shops, toilets,

etc. can be provided.

3. Shopping malls, commercial establishments etc. can be provided space on rent in the

first and second floor.

4. Office of Bus Station In-charge, SNT Guest house, etc. can be located on the third floor.

The commercial property developed as above could be used to earn non-traffic revenue through

leasing of the property. Alternatively, the bus station-cum-commercial complex could be

developed on BOT basis to minimize the initial investment of SNT in the project.

Since the old truck terminal in Pradhan Nagar is likely to be vacated after the truck operations

shift to the new site at Transport Nagar, the land would be available for development. Since the

land is in a residential area, the Government of Sikkim may provide necessary funds to develop a

transit accommodation complex for the citizens of the State of Sikkim. Appropriate charges may

be levied for people who avail this transit facility.

6.2.2 Rangpo

Rangpo has been identified as one of the primary towns where major economic activities of the

state are taking place. The Government has declared Rangpo-Gangtok as a major industrial

corridor. Moreover, the construction of 53 km. rail link from Sevoke in West Bengal to Rangpo is

a major development which is likely to take place in the future, having major economic

implications for the State of Sikkim. With the construction of the rail link Rangpo will eventually

emerge as the logistic hub of the state. Even in the present circumstances the logistics of goods

transportation would revolve around Siliguri and Rangpo. Since SNT has already developed a

modern truck terminal at Transport Nagar in Siliguri, it must plan a similar infrastructure in

Rangpo. The infrastructure in Rangpo would also consist of major warehousing facility. Even

from the passenger transport point of view Rangpo is likely to develop as a major hub.

SNT has an important property at the old depot and bus terminus. It is recommended to develop

a major bus station on this land. The existing area could be expanded by shifting the post office

to some other location in town. The bus station could be integrated with maintenance facilities

for the buses stationed in Rangpo. The funding for construction of the bus station-cum depot


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could be provided by the Government of Sikkim. Alternatively, the funding for the same could be

sought from the Central Government under JNNURM. The Government of Sikkim would have to

approach the Central Government to approve Rangpo as one of the cities eligible for JNNURM

funding.

6.2.3 Gangtok

It is understood that the proposal for modernization of the Gangtok bus station has already been

approved. A plan for developing the bus station including parking facility for government

vehicles at the top with connectivity through an access lane/ramp originating beside Yatayat

Bhawan needs to be prepared. It is also suggested to shift the Motor Vehicle Department from

the Bus Station premises.

6.2.4 Jorethang

As far as the properties at Jorethang are concerned, the following suggestions may be evaluated.

It is suggested to continue with the proposed plan of constructing a community hall and

beautification of the existing area.

Feasibility for construction of staff quarters/guest house over community hall could also

be explored.

Similarly, suitable projects may be identified to utilize all the other lands already in possession or

earmarked for future use of SNT.

6.3 Computerisation in SNT

It is felt that SNT may go in for comprehensive computerization to improve their information

system for better managerial control. It is also important to reduce the operating cost in SNT

through optimum utilization of manpower. A computerized system would reduce the

requirement of manpower and establish a reliable data base for decision making. The system

would include development of computerized modules for all functional areas associated with

passenger and goods transportation. The system could also include tracking of trucks and

tankers through a GPS based system.


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Chapter 7

Fleet Replacement and Augmentation

7.1 Introduction

This chapter deals with study of scrapping policy of SNT and other STUs, framing of scrapping

policy for SNT and quantifying the fleet to be scrapped over a period of 5 year. In addition, this

chapter also deals with estimation number of vehicles required in horizon year taking into

account the fleet replacement and augmentation needs.

7.2 Scrapping policy in other STUs – A Review

Major factors generally considered while framing the scrapping policy are cost of

vehicle, vehicle utilization and terrain. The scrapping policies of similar STUs are

as follows:

Table 7.1: Scrapping policy in similar STUs

Name of the STU’s Hilly Region Scrapping policy

Year Lakhs kms.

HRTC - 6.00

JKSRTC 10 -

MZST 7.00 -

NGST 6.75 3.00

SNT 10 4.5

It is observed from the above table that in hilly terrain, except JKSRTC and SNT all

other STU’s have scrapping policy less than 10yrs. The following points emerge

from comparison of JKSRTC and SNT.

1. Terrain – JKSRTC is also operating in hilly terrain like SNT

2. Passenger and Freight operation - JKSRTC is the only organization like SNT

which has its presence not only in passenger operation but also in freight

operation.

3. Scrapping policy - In terms of years, both the organisations have same

number of years for scrapping of vehicles.

It was cited in the Audit Report submitted in State Legislative Assembly in Kashmir that the

operating cost of JKSRTC has increased 4 to 5 times while revenue has just doubled during the


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same time period and major reason was that JKSRTC has not been able to replace the fleet as per

the laid down policy.

The report further states that “providing public transport service is a social obligation of the

government and privatization is not the best possible solution. It is important to note that public

transport is the only means of transport to remote villages where private operators do not ply

due to uneconomical returns. The government should therefore perceive JKSRTC as a social

obligation and not merely as a profit making corporation”.

It is understood that SNT has accepted the policy of scrapping vehicles which have achieved the

age of 10 years or have covered 4.5 lakh kilometer, whichever is earlier. Considering the

operating conditions and wear and tear caused due to it, the team is of opinion that SNT should

have scrapping policy only in terms of years i.e. 10 years like JKSRTC. Further, it is also

recommended that SNT should strictly comply to the laid down norms.

In order to find out the number of vehicles to be scrapped every year (upto 2013), the age wise

analysis of all vehicles with SNT is carried out and result is summarized below in Table 7.2.

Table 7.2 Age-wise classification of vehicles

Age in no. of years (reference year 2009)

Buses Trucks Tankers Total

1 0 0 0 0

2 2 12 2 16

3 1 8 0 9

4 0 2 2 4

5 0 2 0 2

6 4 5 0 9

7 5 6 0 11

8 9 5 5 19

9 1 0 0 1

10 2 0 0 2

11 10 3 4 17

12 0 2 0 2

13 3 3 0 6

14 12 0 0 12

15 9 0 2 11

16 2 0 4 6

17 2 0 0 2

18 and above 13 1* 14 28

Total 75 49 33 157

*: excluded the recovery vehicle


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After age wise classification, the next step is the quantification of vehicles to be scrapped every

year. The result of analysis has revealed that 53 buses, 9 trucks and 24 tankers have to be

scrapped in the year 2009, if the policy to scrap the vehicles of age 10yrs and above is followed.

The number of vehicles due for scrapping from 2009 to 2013 is given in the table 7.3.

Table 7.3: Vehicles to be scrapped as per accepted policy

Year Number of vehicles to be scrapped


2009 53 9 24 86

2010 1 0 0 1

2011 9 5 5 19

2012 5 6 0 11

2013 4 5 0 9

Total 72 25 29 126

Considering the constraints of availability of funds, it is thought appropriate to

distribute these vehicles uniformly over five year starting from 2009. The year

wise detail on number of vehicles to be scrapped and replaced by new vehicles is

given in the table 7.4. The objective is to ensure a healthy fleet at the end of five

years.

Table 7.4: Vehicles to be replaced

Year Number of vehicles to be scrapped & replaced by new vehicles


2009 14 5 6 25

2010 14 5 6 25

2011 14 5 6 25

2012 14 5 6 25

2013 16 5 5 26

Total 72 25 29 126

Before proceeding further, it recommended that SNT will have to strictly comply with laid down

scrapping policy and in no case the vehicles with age more than 10yrs should be in the fleet after

2013. This will ensure a substantial reduction in maintenance cost and vehicle off-road.

7.3 Fleet requirement for Horizon Year

It is well known among the experts of transport and planning groups that the growth in

passenger and freight traffic has an influential relation with the growth in Gross Domestic

Product (GDP). So, it was thought appropriate to study the year wise trend in GDP of Sikkim and


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accordingly estimate the average percentage increase in GDP. The GDP for Sikkim and the

percentage growth is given in Table 7.5.

Table 7.5: Year-wise Gross Domestic Product in Sikkim

Year GDP at current price (Rs. In

crores) Percentage increase in GDP

2000-01 1014 -

2001-02 1136 12.03

2002-03 1276 12.32

2003-04 1430 12.07

2004-05 1602 12.03

2005-06 1803 12.55

2006-07 2040 13.14

Average 12.36

Analysis of data considering the growth in GDP of Sikkim from the year 2000-01 to 2006-2007 has

revealed that the average percentage increase in GDP is 12.36 %.

For estimation of the number of vehicles required in the future, the data comprising of number

of vehicles in current year and average of percentage increase in GDP is required.

Therefore, number of buses required in the year 2009

= (avg. percentage increase in GDP X number of buses /100) +

existing number of buses)

= ((12.36 x 75) / 100) + 75 = 84

Similarly, for the year 2010, number of buses required is estimated as given below

= (avg. percentage increase in GDP X number of buses in the year 2009 /100) + number of buses in

the year 2009)

= ((12.36 x 84) / 100) + 84 = 95

Similarly, number of buses, trucks and tankers required in the horizon year is estimated and

summarized in table 7. 6.

Table 7.6 : Fleet position in the Horizon Year


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Year Number of vehicles

Buses Trucks Tankers

2009 84 55 37

2010 95 62 42

2011 106 70 47

2012 120 78 53

2013 134 88 59

To make the augmentation of vehicles uniform over five years, the requirement of fleet has been

evenly distributed from 2009- 2013. According to the projected fleet strength for 2013, the

additional vehicles required will be 134 –75 = 59 and these 59 vehicles have been distributed

uniformly so that on an average of 12 buses are required to be purchased. Similarly, the

requirement of trucks and tankers has been calculated. The requirement is summarized in Table

7.7.

Table 7.7 : Additional requirement of fleet in horizon year

Year Number of additional vehicles required


2009 12 8 6

2010 12 8 5

2011 12 8 5

2012 12 8 5

2013 11 7 5

59 39 26

7. 4 Five-Year Plan: Augmentation and replacement of SNT Fleet

Total number of vehicles to be purchased in the future is the sum of number of vehicles to be

replaced and number of additional vehicles required in future.

The details of number of vehicles to be purchased every year is given in table 7.8 on the next

page.

Table 7.8: Total requirement of fleet in the horizon year


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Year Vehicle Vehicles required for replacement

Vehicles required for augmentation

Total

2009

Buses 14 12 26

Trucks 5 8 13

Tankers 6 6 12

Total 51

2010

Buses 14 12 26

Trucks 5 8 13

Tankers 6 5 11

Total 50

2011

Buses 14 12 26

Trucks 5 8 13

Tankers 6 5 11

Total 50

2012

Buses 14 12 26

Trucks 5 8 13

Tankers 6 5 11

Total 50

2013

Buses 16 11 27

Trucks 5 7 12

Tankers 5 5 10

Total 49

7.5 Financial estimate for Buses

Based on passenger demand, type of terrain and need to reduce the cost of operation, it is

recommended that SNT should purchase 35 or 28 seater buses. Accordingly an estimate has

been prepared considering the approximate cost of buses purchased in the recent past. The

details of which are given below in Table 7.9.

Table 7. 9: Financial requirement for buses

Year Total number of buses (nos)

Unit cost (Rs.) (approximate)

Total cost (Rs.)

2009 26 13,00,000 3,38,00,000

2010 26 13,00,000 3,38,00,000

2011 26 13,00,000 3,38,00,000

2012 26 13,00,000 3,38,00,000

2013 27 13,00,000 3,51,00,000

7.6 Financial estimate for Trucks and Tankers

This financial estimate has been worked out as given in table 7.10 below. It is based on the

approximate cost of trucks and tankers, as purchased by SNT in recent past.

Table 7.10: Financial requirement for trucks and tankers


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Year Total number Trucks & Tankers

(nos)

Total number of Trucks &

Tankers (nos)

Unit cost (Rs.) (approximate)

Total cost (Rs.)

Trucks Tankers

2009 13 12 25 10,00,000 2,50,00,000

2010 13 11 24 10,00,000 2,40,00,000

2011 13 11 24 10,00,000 2,40,00,000

2012 13 11 24 10,00,000 2,40,00,000

2013 12 10 22 10,00,000 2,20,00,000 7.7 Total financial requirement

Total financial requirement is summarized in the table below.

Table 7.11: Total financial requirement for all vehicles

Year Financial Requirement (Rs.) Total cost (Rs.)

Buses Trucks and Tankers

2009 3,38,00,000 2,50,00,000 5,88,00,000

2010 3,38,00,000 2,40,00,000 5,78,00,000

2011 3,38,00,000 2,40,00,000 5,78,00,000

2012 3,38,00,000 2,40,00,000 5,78,00,000

2013 3,51,00,000 2,20,00,000 5,71,00,000

The above estimation has been done to distribute the financial requirements over five years.

However, depending on the availability of finance, the plan could be advanced for higher

benefits. During the recent visit to Sikkim, it was learnt that SNT has scrapped some vehicles in

the recent past. The requirement worked out can be adjusted for new vehicles which have

already been purchased or old vehicles which have been scrapped. The list of vehicles for the

purpose of estimation of requirement in the future is given in Annexure 7.1.

Annexure 7.1

List of all the vehicles considered in the analysis

Sl. No. Vehicle Registration Number


1 SK04/0794 SK03/0383 SK03/0197

2 SK04/0804 SK03/0283 SK03/0199

3 SK04/0818 SK03/0641 SK03/0210

4 SK04/0805 SK03/1075 SK03/0212

5 SK04/0824 SK03/1077 SK03/0227

6 SK04/0853 SK03/1078 SK03/0221

7 SK04/0789 SK03/1120 SK03/0224

8 SK04/0850 SK03/1122 SK03/0214

9 SK04/0915 SK03/1124 SK03/0223

10 SK04/0919 SK03/1142 SK03/0215


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11 SK04/0873 SK03/0276 SK03/0217

12 SK04/0933 SK03/0278 SK03/0388

13 SK04/0934 SK03/1295 SK03/0392

14 SK04/1204 SK03/1357 SK03/0390

15 SK04/0855 SK03/1364 SK03/0893

16 SK04/0907 SK03/1622 SK03/0894

17 SK04/1206 SK03/1620 SK03/0213

18 SK04/0921 SK03/1524 SK03/0205

19 SK04/0930 SK03/1526 SK03/0209

20 SK04/0927 SK03/1527 SK03/0391

21 SK04/0917 SK03/0337 SK03/1225

22 SK04/0916 SK03/0272 SK03/1230

23 SK04/0929 SK03/0298 SK03/1236

24 SK04/0899 SK03/0353 SK03/1237

25 SK04/0828 SK03/0315 SK03/1568

26 SK04/0857 SK03/0319 SK03/1569

27 SK04/0923 SK03/2262 SK03/1658

28 SK04/0924 SK03/2263 SK03/1656

29 SK04/0925 SK03/0280 SK03/1659

30 SK04/0931 SK03/0316 SK03/0309

31 SK04/1158 SK03/0325 SK03/0371

32 SK04/1159 SK03/0336 SK03/3481

33 SK04/0900 SK03/0373 SK03/3485

34 SK04/0926 SK03/0318

35 SK04/0935 SK03/0939

36 SK04/1201 SK03/0270

37 SK04/0868 SK03/0333

38 SK04/0890 SK03/3011

39 SK04/1157 SK03/3018

40 SK04/1205 SK03/3016

41 SK04/0885 SK03/3015

42 SK04/2669 SK03/3012

43 SK04/2672 SK03/3014

44 SK04/2671 SK03/3013

45 SK04/2673 SK03/3010

46 SK04/2667 SK03/0258

47 SK04/2668 SK03/0260

48 SK04/2670 SK03/0317

49 SK04/2664 SK03/0320

50 SK04/2666 SK03/0381

51 SK04/2998 SK03/0809

52 SK04/3410

53 SK04/3409

54 SK04/0837

55 SK04/4146

56 SK04/4149


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57 SK04/4143

58 SK04/4144

59 SK04/4145

60 SK04/4147

61 SK04/4148

62 SK04/0886

63 SK04/0816

64 SK04/1207

65 SK04/0834

66 SK04/0867

67 SK04/0884

68 SK04/0879

69 SK04/0829

70 SK04/0896

71 SK04/0937

72 SK04/0888

73 SK04/0856

74 SK04/922

75 SK04/932


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Chapter 8

Maintenance Management

8.1 Introduction

The quality of maintenance in a transport organization has a direct bearing on the health of the

fleet and has implications on customer satisfaction. It is an established fact that the

maintenance requirements increase in proportion with the age of the vehicle. Although, SNT has

elaborate maintenance infrastructure at the Central Workshop in Ranipool and depot workshops

in Gangtok and Jorethang, the facilities are under-utilized due to reduction in fleet size. A large

number of vehicles which have passed their productive life in terms of the scrapping policy

followed by SNT, have not been replaced due to financial and administrative constraints. The

system of preventive maintenance is not well established in the organization and breakdown

maintenance is resorted to in majority of the cases. The provision of vehicles fit for operation is

the responsibility of the depot and central workshop. In other words, these work centers are

responsible for carrying out preventive maintenance as well as major overhaul of vehicles.

Further, SNT has a vision to make depot infrastructure a state of art in the future. To achieve this

objective and make appropriate recommendations, the following tasks were taken up.

To study the adequacy of existing infrastructure facilities.

To review the maintenance practices followed by depot and central

workshop.

To study the current practices followed in materials management and

inventory control.

To address the issues related to manpower adequacy at the depots.

To review the existing information system.

Accordingly, the following suggestions have been made to improve the fleet

maintenance system in SNT.


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8.2 Integrated depot management system

The present structure in SNT has been established considering the traffic and

maintenance departments performing mutually exclusive functions of operating

the vehicle and maintaining it. This has led to a situation where the driver who

is under the traffic operations department goes to the workshop for

maintenance only if the vehicle is not mechanically fit to operate. Since the

operations in SNT are limited, it would be beneficial to follow an integrated

management system. In the new system, any senior officer from either traffic or

maintenance areas could be the head of the depot. Two junior officers, one

from the traffic and maintenance functions each would be required to report to

him. This would ensure proper coordination between the two departments and

establish unity of command and purpose.

8.3 Maintenance of vehicle record

It was observed that the driver of vehicles are not issued a duty slip/log sheet

where the nature of duty assigned, time of departure, kilometers covered and

fuel taken could be recorded. Under the present circumstances it is difficult for a

depot to keep a record of the mileage covered by the vehicle to plan for

preventive maintenance. It is recommended that SNT should have a gate system

where a fresh duty is allotted to the vehicle and driver after daily maintenance.

The driver is issued the duty slip by the workshop supervisor indicating the name

of the driver, schedule allotted to the vehicle, time of departure and diesel

issued. The driver is responsible to bring the vehicle to the workshop after

completion of his schedule and the time of arrival, kilometers covered and other

details are entered by the supervisor at the bus station. This completed duty slip

is submitted by the driver in the workshop and the vehicle is handed over to the

maintenance staff to plan for maintenance and next allocation of the vehicle.

The record of kilometers covered and fuel consumed are compiled in the


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workshop to plan for preventive maintenance and keep a record of vehicle

history. This system would ensure that the vehicle is regularly brought to the

depot and all defects reported by the driver and preventive maintenance due is

undertaken on time. Since the vehicle belongs to the depot, it should not be the

prerogative of the driver to decide when the vehicle has to be brought to the

workshop.

8.4 Preventive maintenance

SNT has a laid down policy on preventive maintenance to be carried out on daily, weekly and

monthly basis. Engine oil change is carried out at 18,000kms and reconditioning is done every 3

months. Gear oil change is done 14,000 kms and reconditioning is done once in six months. The

Central Workshop is generally taking care of problems related to major body repair, engine

compressor repair, Front axle, Rear axle, FIP calibration etc. However, it is observed that the

quality of preventive maintenance needs improvement. Since it is not necessary for the driver to

whom the vehicle is allotted to bring the vehicle to the depot on completion of its schedule, the

preventive maintenance schedules are not adhered to. Similarly, daily maintenance which is

essential for preventing major breakdowns is not taken up. Under the integrated depot

management system, it could be made mandatory for the driver to bring his vehicle to the depot

workshop for maintenance after completion of schedule. The preventive maintenance schedules

comprising of daily maintenance, monthly maintenance, quarterly maintenance, 18,000 kms.

maintenance, 36,000 kms. maintenance and 72,000 kms. maintenance keeping in mind the

recommendations of the manufacturers and experience of similar STUs is given as an annexure

8.2 to 8.5. The Maintenance Supervisor at the depot would identify the vehicles which are due

for a particular maintenance based on the cumulative kms. from the driver duty slips maintained

in a vehicle utilization register. The list of such vehicles which are due for preventive

maintenance would be sent to the officer-in-charge of the depot on a daily basis for monitoring.

However, daily maintenance schedules would be carried out on all vehicles before out-shedding

from the workshop.

8.5 Requirement of Plant and equipment

To improve the quality of maintenance in the depots of SNT, it is important to upgrade the plant

and machinery available. It was observed that some of the equipment has completed its

productive life and needs to be replaced while additional equipment has to be added to the


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existing facilities. Based on the discussions with officials of SNT and observations of the team, the

plant and equipment required at Gangtok and Jorethang depots is given in Annexure 8.1.

8.6 Manpower norms

The maintenance personnel posted at the depot workshop for carrying out maintenance

activities comprise a large portion of the maintenance costs associated with the vehicle. It

should be the endeavour of any transport organization to minimize the maintenance manpower

required to carry out the various activities at the depot. Accordingly, manpower at the depot

manpower should be based on maintenance activity to be carried out at depot level and the total

workload of that activity in a month. This should be the base for deciding the number of persons

to be posted in each trade. Considering the experience of similar STUs, the norms for depot

workshop manpower are given in table 8.1 on the next page.

Table 8.1: Norms for Manpower Planning

Category Manpower/Bus

(For schedule only)

Mechanic/Fitter 0.50

Electrician 0.06

Coach builder/panel beater/ Blacksmith 0.08

Trimmer 0.02

Painter 0.02

Tin Smith/Welder/ Mill Wright 0.06

Helper/Cleaner 1.00

Tyre Mechanic 0.03

TOTAL 1.77

However, it is learnt from the data on available manpower at depots that there are excess

foremen at the depot level. Considering the span of operation and number of vehicles operated,

it is recommended that there should be one foreman supported by 2 junior foremen who will

supervise all the activity of maintenance including welding, electrical, painting etc. The grades of

mechanical fitter should be under 3 categories (1-skilled, 1-semi skilled and 1-unskilled). Further,

the unskilled staff should be common for all trades depending on the skills he acquires and his

aptitude towards a particular trade.


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8.7 Maintenance Information system

The existing Maintenance Information System in SNT is as follows:

The “Daily Vehicle Position Report” is sent to head office from depot daily.

Report on utilization of spare parts is sent from depot to central workshop periodically.

Depot also sends a report to the head office comprising of bills of local purchase made

and the details of spare parts consumed from supply from the central workshop.

It is recommended that the information of daily vehicle position should be sent not only to head

office but also to central workshop. Based on the daily vehicle position, an “action taken report”

may be sent jointly by the central workshop and central stores to the headquarter.

The vehicle master register for each vehicle has to be maintained and the kms. performed after

completion of each schedule has to be entered in the register to arrive at the cumulative kms.

performed by the vehicle. The preventive maintenance is calculated based on the cumulative

kms. and completion report entered in the register after carrying out the preventive

maintenance schedule. It should be the endeavour of the Maintenance Supervisor to allocate

the vehicle on a schedule only after the preventive maintenance schedule due is carried out. A

report on the vehicles due for various preventive maintenance schedules and the vehicles

undergone the schedule should be sent to DGM on a daily basis. Incase of breakdown or non-

compliance of maintenance schedules, responsibility may be fixed.

8.8 Materials management

A good preventive maintenance policy in isolation without availability of spare parts and float

assemblies/aggregate has no meaning. It was learnt from the study that there is a policy laid

down for purchase of spare parts. However, there is considerable delay in ensuring availability of

spare parts. As a result, SNT has empowered the in-charge of depot to purchase spare parts

from local market with restriction on the amount of purchase he can make. It is recommended

that SNT should give due consideration to rising cost of spare parts and other factors while fixing

the purchasing power at the depot level.

At the central store level, it has to be ensured that a minimum inventory of fast moving items is

maintained for supply to the depots according to demand. The funds for purchase of adequate

spare parts to maintain the optimum level of spare parts in the central store has to be ensured

by the Finance Department. Adequate funds have to be provided to retire the documents as far


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as possible within 8 days. It was observed that the materials management system is under

computerization at the central store level which would facilitate the maintenance of optimum

levels of inventory.


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Annexure 8.1

Sl no Nomenclature Quantity required (nos.)

Jorethang Gangtok

1 Air compressor 5 HP - 1

2 High pressure Greasing equipment 1 1

3 Car washer / automatic brush washing machine 1 automatic brush washing

machine

1

4 Distilled water plant - 1

5 Heavy duty sewing machine

- 1

6 Electric Arc welding plant 1 1

7 Battery charger machine - 1

8 Gas welding plant 1 1

9 Trolley jack 2 2

10 Electric bench Grinder - 1

11 Toe-in-alignment gauge 1 2

12 Drilling machine portable 10mm capacity - 2

13 Hand platform trolley 1 1

46A Master pressure gauge wall type 1 1

14B Hand guage 1 1

15 Bench arbor press 1 1

15A Battery cell tester 1 1

15B Hydrometer (battery acid gravity tester) 1 1

16 Pop riveting gun 1 2

17 Voltmeter/ Ammeter 1+1 1+1

18 Anvil with grinder 1 2

19 Grease gun - 2

20 Paint spray gun - 1

21 Compression Tester Not applicable to depot

22 Mechanics work bench 2 2

23 Towing chain 1 1


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Sl no Nomenclature Quantity required (nos.)

Jorethang Gangtok

24 Jib Crane - 1

25 Swage block - 1

26 Tap & Die set (BSF & WW Set) 1 1

27 Mechanical tyre changer 1 1

28 Smithy blower electrically operated 1 1

29 Chain pulley block 1 1

30 Kingpin remover 2


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Annexure 8.2

Daily Maintenance

1. Check the engine oil level and top–up if necessary (level should be above minimum and

below maximum mark on the dip stick)

2. Check fuel level in the fuel tank use automatic cut off nozzle or fill 10litres less than the

tank capacity to avoid spillage (considering hilly region)

3. Check coolant level use only 50% water and 50% ethylene Glycol. (Remove the radiator

cap when the coolant temperature is below 50o

C).

4. Visually inspect the fan and drive belt and replace if necessary (one fan and belt of

common model should always be kept in stock in each depot)

5. Drain the water from the water separator on fuel line and also the condensed water

from water tanks

6. Check the proper functioning of brakes

7. Check and inflate tyre in cold condition. The tyre pressure as recommended by OEM’s is

normally 85PSI (6kg/cm2) for front tyres and 95PSI (6.75 Kg/cm

2 ) for rear tyres

8. Check for leakage for coolant air, fuel and oil, hose connection flexible pipes, joints and

rectify if necessary

9. Check functioning of lights, horn, wiper, blinkers, switches, starter, alternators etc.

10. Attend all the defects mentioned by drivers on log sheet

11. Wash from outside and clean the bus before every days fresh departure.


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Annexure 8.3

Monthly

Carry out the following in addition to daily maintenance

1. Check clutch pedal free play and adjust if necessary it should be 5-10mm

2. Check Air dryer functioning if there is any condensed water /oil in the exhaust replace

the air dryer cartridge and filter

3. Check the level of gear box oil and rear axle oil and top-up if necessary with respective

recommended grade oil i.e. APIGLA (SAE 80) for gear box and APIGLB (SAE 90) for rear

axle

4. Check fluid level in the clutch fluid reservoir. (Grade SAE J 1703 E/F)

5. Check oil level in the power steering reservoir. Oil level should be above the top mark by

1-2mm. (Grade ATF – Type A)

6. Check and confirm no leakages of oil any where in the power steering system.

7. Check level of electrolyte in the battery it should be 10-12mm above the plates. Check

starter and battery terminals

8. Check all wheel nuts and tighten if necessary

9. Check brake system for leaks and rectify

10. Check leaf springs U bolts tighten with torque wrench with 35 kg-m torque or use

handle with 60cm length.

11. Lubricate all linkages, bushes, pins, ball joints, pivots and grease slack adjuster,

propeller shaft U Joint, sliding brackets, pins etc ( it is recommended to use high

pressure pneumatic greasing gun and use only the recommended lubricant grease.


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Annexure 8.4

Quarterly (3 months)

1. Check air intake piping, cracked hoses, service indicator. Check if red indicator flag

raises and change the primary filter element (Pl. note the secondary filter is to be

changed after replacement of primary filter thrice)

2. Check and tighten the pitman arm, drag link, tie rod, steering gear box mounting bolt

etc.

3. Check and tighten brake plate mounting bolt

4. Check for travel of brake chamber push rod before it reaches 45 mm also check brake

lining wear and clearance with the drum (0.5 to 1 mm) can be measured by using filler

gauge.

5. Exhaust brake linkage and butterfly valve shaft with brake pedal fully released there

should be exhaust brake application, this can be made out from distinct change in

engine noise (exhaust brake is very much useful while driving during the ghat/steep hill).

6. Adjust service brakes/slack adjusters, brake adjustment should be done only when the

drums are cold. Follow the brake adjustment procedure by jacking up wheels as

recommended by the OEM (Original Equipment Manufacturer).

7. If the defect of brake setting is repeated the procedure can be followed at every 4500

km. of operation.

8. Check and if necessary tighten mounting of shock absorber, condition of shock absorber

rubber bushes, and replace if necessary.

9. Check clutch system and rectify leaks if any. Adjustment of clutch (352 mm dia) is

performed when the clutch is released. When the clutch is engaged, the distance

between release bearing and clutch cover should be 47 mm. It again requires

adjustment when the clutch wear is more than 3mm. Clutch disc should be replaced

when this gap is more than 48 mm (This is very important since operation of clutch is

very frequent while driving in hilly region)

10. If a vehicle covers 250 hrs or 3 months from its last engine oil change then engine oil

and oil filter of such vehicles should be changed irrespective of kms. (being a hilly region

engine operates in extreme load condition for a longer and repeatedly). Drain the oil

only when it is hot. Fill the filter with clear lubricating oil before installation. Use only

recommended APP/Castrol multi-grade by the OEM’S. Oil sump capacity is 14.3 lit. max

and 12.3 lit. min.


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Annexure 8.5

A) 18,000 km. Schedule (Preventive maintenance schedule)

1. Check anti-freeze concentration ensure 1:1 ratio.

2. Check gearbox mounting bolts, propeller shaft-coupling bolts, CIB support bracket bolt.

3. Tighten all body mounting bolts

4. Check all spring brake actuator nylon breather, brake valve mounting bolts of brake

chamber, air tank mounting etc.

5. Check rear axle carrier mounting, nuts, axle shaft cover bolts.

6. Check wheel alignment adjust toe in 0-3 mm.

7. Remove FT hub cap and fill W/B. grease and refit.

8. Replace fuel filters in dual filter replace O ring, fill the new filters with clean fuel, bleed

the fuel line if required same as required for removing air locks.

9. Lubricate clutch release bearings and yoke cross shaft bushes through grease nipples.

10. Replace the belt if the deflection exceeds 12.7mm.

B) 36,000 km. /preventive maintenance schedule

1. Remove the driver bell and check free movement of tensioner pulley bearing and fan

hub install the drive belt.

2. Adjust valve clearance by pressing engine timing pin and locate TDC with engine

temperature less than 600 C.

Intake clearance – 0.25 mm

Exhaust clearance – 0.50 mm

3. Remove all the brake drums, inspect brake linings, brake drums rectify, remove all the

filter elements in the air filter-clean and refit, replace brake linings or adjust indicator

slot 1mm above the rivets. Grease fulcrum, pin bushes and roller end, use same make of

brake assemblies, brake linings and brake actuator on the same axle. Brake drums

should not be used beyond repair size II (416 mm)

4. Remove front and rear hub, dismantle and clean bearing other components and repack

with bearing grease (Grade M/P grease no. Adjust bearing play (Front hub 0.01-0.14 mm

and Rear hub 0.01 – 0.02 mm)

5. Check and tighten connections of starter alternator switches, gauges, tail lamp,

speedometer cables etc.

6. Change oil in the gear box drain while it is hot clean drain plug and refill the gear box by

fresh oil. Oil cap GBS 40-5.2litres, GBS 50-8litres. Oil grade APIGLA – SAE 80.

7. Remove the strainer in the fuel tank, clean and refit.


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8. Change oil in the rear axle drain while it is hot, clean drain plug and breather

Cap RA 108 – 7.5litres

RA 109 – 11litres

Oil grade APIGL-5 (SAE-90)

9. Check bus body from inside particularly seats, cushions rexin, lights, door locks etc. and

carry out necessary repair.

C) At every 72,000 km. (once in two years for SNT)

1. Check vibration damper and replace if necessary

2. Check battery cells with cell tester electrolyte gravity and attend

3. O/H clutch master cylinder and fluid reservoir, slave cylinder, bleeding screw etc.,

replace clutch fluid by new one by the recommended grade (SAE J 1703 E/F)

4. Drain power steering oil, change filter cartridge by new one, fill oil in the reservoir tank,

upto the top mark of the dip stick, use ATF type -A oil, system capacity 3 litres bleed the

power steering system as specified.

5. Dismantle all the pneumatic aggregates of ‘s’ can brake system, overhaul including

foundation brakes.

6. Dismantle all the leaf springs, clean, apply graphite grease, recamber the leaves/replace

by new grease all the pins.

7. Drain the cooling system, clean by using 0.5 kg. of sodium carbonate, operate the

engine for 5 min with flushing mixture. Shut the engine off and drain the cooling

system. Fill it with water again operate the engine for 5 min. refill the system with 50%

water and 50% ethylene glycol antifreeze. Engine cap 9 litres. Allow air vent. Install the

pressure cap.

8. Remove the injectors check and reset the pressure.

9. Remove strainer in the fuel tank clean and refit

10. Check end play of the turbocharger shaft and radial clearance between turbine wheel

and housing.

11. Check all the items that have been checked during 36,000 km. also

12. Bus body should be fully painted once in two years after attending all minor/major

accident repair and also the operational damages.

13. Please check all the window glasses, seats, cushions etc. and carry out necessary repairs.

14. If any item is not specified in the maintenance schedule, it should be followed as

recommended by the OEM’s in service/operator manual.


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15. Though the frequency of maintenance is recommended on km. basis, SNT can follow

their own system based on their experience considering the meantime between

failures.

Documents

PERFORMANCE IMPROVEMENT MEASURES FOR SIKKIM …...Sikkim is the least populous state in the country with only 540,851 inhabitants as per 2001 Census growing by 33.06% during 1991-2001