The number of e-way bills or electronic permits for shipment of goods within and across states surged to 103.1 million in May—a little shy of an all-time high of 103.5 million seen in March—indicating brisk supply chain movement. 

It is the third instance that e-way bill generation has crossed the 100-million mark. Before March, it surged past 100 million in October 2023, showed data from Goods and Services Tax Network, or GSTN, the company that processes GST return forms. In May 2023, the number of e-way bills stood at 88.1 million.

The robust goods shipment data—after a dip to 96.6 million in April—is in line with purchasing managers' assessment of demand for goods in the country. India's manufacturing sector remained firmly in expansion mode midway through the first quarter of 2024-25, despite a mild drag on growth momentum as reduced working hours due to heatwaves hampered production volumes, S&P said earlier this month. 

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The market intelligence provider then reported its manufacturing purchasing managers' index (PMI) at 57.5 in May, a tad lower than the 58.8 reported in April, suggesting a slower but still substantial improvement in the health of the manufacturing sector. A reading above 50 indicates an expansion.

Strong supply chain

The e-way bill data for May showing 103.1 million goods shipment permits is a strong indicator of robust supply chain movements and sustained demand for goods, said Rajat Mohan, executive director at accounting and advisory firm Moore Singhi. 

"This near-record figure, second only to 103.5 million in March, highlights the resilience and steady growth of the logistics sector. It reflects a consistent and healthy flow of goods across the country, suggesting that businesses are maintaining or increasing their inventory levels in response to strong consumer demand," said Mohan. 

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This high volume of e-way bills can be interpreted as a sign of economic stability and growth, as it indicates active trade and commerce, crucial for overall economic health, Mohan said. 

Economic health

It also suggests that achieving GST revenue collection of ₹2 trillion in the coming months is not far-fetched, he said. 

The Centre and states collected ₹1.73 trillion in GST revenue in May after a record collection of ₹2.1 trillion in April. Taxes for transactions in May are collected in June. 

Among other indicators of economic activity, Indian Railways reported a 9% month-on-month growth in freight loading in May at 139.16 million tonnes, the Indian Infrastructure portal reported on 5 June. 

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Automobile retail segment also showed a modest annual growth of 2.61% in May after an impressive 27% annual growth in April, showed data from the Federation of Automobile Dealers' Association, or FADA. While two-wheelers, three-wheelers and commercial vehicles witnessed growth in sales in May, passenger vehicles and tractors witnessed a dip as extreme heat and elections impacted the footfall in showrooms, according to the association. 

Output of both manufacturing and construction sectors is estimated to have expanded 9.9% each in 2023-24, helping the economy achieve an 8.2% growth.