Indefinite strike called by Indian truckers begins Wednesday, to hit economic growth

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"We are selling normal diesel to truckers at our retail outlets on highways, everywhere it is available...only in cities are we encouraging people to buy branded fuel," he said.

Last month, the Indian government hiked fuel prices by 10 percent in response to high global crude prices, which presently is hovering above $140.

However, unlike normal petrol and diesel prices, the government has no control over the prices of branded fuels, which are decided independently by oil firms.

The transporters union is also protesting against the hikes in road tolls and transport taxes, a member of AIMTC said.

The strike is set to disrupt supply of goods across India and may thwart the efforts of the government and the central bank, which have taken fiscal and monetary measures to tame inflation that is currently at a 13-year high of 11.42 percent.

"The strike is going to have an impact on the movement of commodities like food grain, vegetables and other raw materials for trade and industry. But it will take another 3-4 days to assess the exact impact of the strike. We have advised our trade bodies to act wisely and check any undue increase in commodity prices," said Praveen Khandelwal, the secretary general of the Federation of All India Traders.

Meanwhile, the ruling Congress-led UPA Government, which is already facing the risk of an early election as its powerful Left allies threaten to withdraw support to the coalition government in case it goes ahead with its nuclear deal with the US, has dismissed reports that the strike is a major issue that could lead to loss in trade worth billions of dollars.

"The issues involved in the strike are not significant issues that warrants a nationwide strike," V. Sridhar, a member of the Central Board for Excise and Customs, said.

The Finance Ministry has invited the truckers to resolve the dispute and end the strike, he said.

According to a government source, the main bone of contention is the allegation of evasion of service tax made by the finance ministry to goods transport agents (GTAs). In recent times, tax recovery notices, dating back to 2001, have been issued by tax authorities for Rs.400-500 crore on several GTAs, due to serious anomalies noticed by taxmen in their audit on GTAs.

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