NEW DELHI : Electronic permits raised by businesses for moving goods within and across states hit a record 90.9 million in March, indicating robust economic activity in the final month of the financial year, according to data available from GSTN, the company that processes GST returns.
NEW DELHI : Electronic permits raised by businesses for moving goods within and across states hit a record 90.9 million in March, indicating robust economic activity in the final month of the financial year, according to data available from GSTN, the company that processes GST returns.
The surge in activity points to businesses pushing goods into the supply chain as they strive to meet annual targets, mirroring last year's activity, which resulted in record GST receipts of ₹1.67 trillion in April. Taxes collected in the current month will correspond to sales achieved by businesses in March.
GSTN data shows that 57.8 million e-way bills were generated in March for goods shipment within states and 33 million permits for inter-state shipments.
This is an 11% improvement over the total e-way bills raised in February.
Earlier this month, S&P Global reported that India's Manufacturing Purchasing Managers' Index or PMI rose from 55.3 in February to 56.4 in March, signalling the sharpest improvement in operating conditions in 2023 so far. March data highlighted a further upturn in new business placed with Indian manufacturers. This expansion, the market intelligence provider said, was sharp and the quickest in three months.
Surveyed businesses cited demand resilience and competitive pricing as growth drivers.
"Since March signifies year-end closing for all businesses who are focused on achieving their sales targets for the fiscal year, the despatch volumes would be quite high, leading to potentially high GST collections," said M.S. Mani, partner at Deloitte India.
Archit Gupta, founder and CEO of Clear, a business-to-business fintech software as a service (SaaS) company, said that the over 90 million e-way bills in March and the revenue collected in March of ₹1.6 trillion (relating to February sales), the second highest since April 2022 GST revenue receipts, indicated two things: "For one, businesses are pushing themselves to achieve year-end sales targets and fulfil orders, and this is apparent in the number of e-way bills issued. Secondly, there are stringent anti-evasion measures by the GST mobile squad that weed out defaulters and urge taxpayers and transporters to comply," Gupta said.
To be sure, e-way bill data only indicates permits generated for shipping consignments valued more than ₹50,000, and the cumulative value of all permits or the tax revenue due cannot be known from the number of permits raised.
The e-way bill data will offer confidence to policymakers about the last quarter of FY23. Federation of Automobile Dealers Associations said on Tuesday said total vehicle sales grew by 14% annually in March, with double-digit growth in sales of passenger and commercial vehicles and in two and three-wheelers. In addition, tractor sales saw a 4% annual growth in March.
Policymakers are banking on a normal monsoon, a lesser than previously expected slowdown in global economic growth and an early resolution of the conflict in Eastern Europe as potential upside to an expected 6.5% growth rate in FY24.
However, ebbing pandemic-related pent-up demand and high inflation remain areas of concern.
Two multilateral agencies, the World Bank and the Asian Development Bank, moderated India's growth outlook for FY24 earlier this week. While the World Bank lowered its forecast to 6.3% from its December estimate of 6.6%, citing slower consumption growth and challenging external conditions, the ADB sharply cut its outlook to 6.4% in FY24, down from its December forecast of 7.2%, citing the ongoing global economic slowdown, tight monetary conditions, and elevated oil prices.