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E-way bills drop 12.5% in November
- Experts said that the sharp month-on-month drop in e-way bill generation was not unexpected, as normally, a month before Diwali, business activity peaks and subsequently it normalizes
New Delhi: Generation of e-way bills needed for transporting goods within and across states have dropped 12.5% to 87.5 million in November from over 100 million permits raised in October, official data showed.
The moderation indicates the normalization of goods movement after a spike in October as companies pushed goods into supply chains to cash in on the festive season. On an annual basis, e-way bill generation improved 8% in November, data showed.
Experts said that the month-on-month drop in e-way bill generation was not unexpected. “Normally, a month before Diwali, business activity peaks and correspondingly, e-way bill generation also surges and subsequently it normalizes,” said R. Muralidharan, a lawyer and indirect tax expert.
This year, Diwali fell on 12 November, the month that witnessed normalization in generating e-way bills after the spike in the month before. Last year, Diwali was on 24 October, which explains a moderation in e-way bill generation in that month to 76.8 million after witnessing a peak of 80 million in the month before.
Experts said businesses tend to replenish wholesale and retail suppliers before the festive season. Also, a spike in goods shipment happens close to the end of a quarter.
Generation of e-way bills, seen as a high-frequency indicator, had steadily risen from 84.43 million in April this year to 100.31 million in October before the latest moderation.
S&P Global’s manufacturing purchase manager’s index (PMI) had shown on 1 December that production activity continued its expansion in November. Picking up from October’s eight-month low of 55.5 to 56.0 in November, the seasonally adjusted S&P Global India manufacturing PMI showed strong operating conditions, according to the market intelligence provider.
A reading above 50 separates contraction from expansion.
Another high-frequency indicator, railway freight, also showed an improvement in November on-year.
In November, originating freight loading of 128.419 tonne has been achieved against loading of 123.088 tonne in November last year, showing an improvement of about 4.33% over the last year, the government said on Tuesday.
In the September quarter, manufacturing output had seen a strong double digit growth of 13.9% from the comparable period a year ago, according to official data from the statistics ministry. This has given a boost to the second quarter economic growth, which stood at 7.6%.
The number of e-way bills generated provides an early indication of the economic trends, but its value is not immediately available. Besides, e-way bills are also generated to transfer raw materials within group companies and hence cannot indicate extent of the accurate value of overall production in the economy.
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First Published:7 Dec 2023, 10:01 PM IST
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