E-way bills drop 12.5% in November | Mint
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Business News/ News / India/  E-way bills drop 12.5% in November
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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

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. (Photo: Bloomberg)Premium
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. (Photo: Bloomberg)

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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ABOUT THE AUTHOR
Gireesh Chandra Prasad
Gireesh has over 22 years of experience in business journalism covering diverse aspects of the economy, including finance, taxation, energy, aviation, corporate and bankruptcy laws, accounting and auditing.
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Published: 07 Dec 2023, 10:01 PM IST
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