E-way bill generation rebounds in December, signalling supply chain recovery
- The recovery signals a normalization in supply chain activities, following a steady climb from July to a record high of 117.2 million in October, driven by festival-season demand.
The issuance of electronic permits, or e-way bills, required for shipping goods within and across states—a key indicator of economic activity—rebounded in December to 112 million, up from a five-month low of 101.8 million in November, according to GSTN, the platform that processes Goods and Services Tax (GST) returns.
The recovery signals a normalization in supply chain activities, following a steady climb from July to a record high of 117.2 million in October, driven by festival-season demand. The subsequent moderation in November reflected businesses pausing after the seasonal peak. Experts believe that inventory clearances could surge further as the financial year draws to a close.
Last month's e-way bill generation marked a 10% rise from November and an 18% increase compared to December 2023, though it remained below October’s record.
The strong recovery in e-way bill generation seen in December from the previous month suggests stabilization of goods movement after the festive-season-driven peak in October and a seasonal dip in November, explained Sanjay A. Chhabria, indirect tax lead at Nexdigm, a business and professional services company.
The annual growth of 17.6% in e-way bill generation seen in December from a year ago underscores several positive developments, said Chhabria.
“These include increased manufacturing output supported by resilient domestic demand, improved infrastructure and logistics efficiencies and greater formalization in the economy as compliance levels rise under the GST regime. The higher number reported for December 2024 also reflects businesses gearing up for year-end closures, strong retail demand in the post-festive period, and restocking activities in key sectors such as fast-moving consumer goods, consumer durables, and e-commerce, which saw significant growth over the year,” said Chhabria.
Other high-frequency indicators paint a mixed picture.
The HSBC India manufacturing purchasing managers’ index (PMI) revealed softer growth in December, with the index falling to a 12-month low of 56.4 from 56.5 in November, according to S&P Global. While still above the long-term average of 54.1—indicating expansion—the pace of improvement in output and new orders moderated.
Vehicle retail sales also showed weakness, contracting 12.5% year-over-year to 1.75 million units in December, Federation of Automobile Dealers Association data revealed. However, tractor sales surged 26%, buoyed by rising rural consumption.
The government’s advance estimates for FY25 GDP released earlier this week projected manufacturing sector growth at 5.3%, a sharp slowdown from 9.9% in the prior year. Policymakers are banking on manufacturing to drive job creation, particularly better-paying positions, as part of broader efforts to bolster economic resilience.
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Business NewsEconomyE-way bill generation rebounds in December, signalling supply chain recovery
First Published:9 Jan 2025, 04:27 PM IST
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